This morning, Binance Research @BinanceResearch gave a dedicated macroeconomic outlook that was very helpful.
The first part helped clarify the market’s risk-pricing logic:
the relationship between interest rates, AI, and inflation pricing.
Some recent macroeconomic factors causing market turbulence include Federal Reserve meetings, macroeconomic inflation data, major tech companies reporting disastrous results, and Middle Eastern oil prices.
The most dramatic price movements happen when marginal changes are most pronounced. The market always trades expectations in advance, so quantitative changes lead to qualitative ones, and the market’s pricing logic shifts accordingly.
For example:
- The reversal from rate-cut expectations to rate-hike expectations corresponded with Bitcoin’s decline from May to August.
- Crude oil prices rose from around $60 at the start of the year to over $100 in the first half. Crossing $100 marked a qualitative shift, and U.S. stocks hit a deep trough in March.
- Crude oil prices rose again from June to September, feeding through to inflation. Inflation became apparent by October, and the market fell.
- Slowing AI growth fed through to neocloud, then to disastrous tech earnings reports—another link in the chain. Inflation was also an underlying factor in earnings falling short of expectations.
#BinanceCampus
The first part helped clarify the market’s risk-pricing logic:
the relationship between interest rates, AI, and inflation pricing.
Some recent macroeconomic factors causing market turbulence include Federal Reserve meetings, macroeconomic inflation data, major tech companies reporting disastrous results, and Middle Eastern oil prices.
The most dramatic price movements happen when marginal changes are most pronounced. The market always trades expectations in advance, so quantitative changes lead to qualitative ones, and the market’s pricing logic shifts accordingly.
For example:
- The reversal from rate-cut expectations to rate-hike expectations corresponded with Bitcoin’s decline from May to August.
- Crude oil prices rose from around $60 at the start of the year to over $100 in the first half. Crossing $100 marked a qualitative shift, and U.S. stocks hit a deep trough in March.
- Crude oil prices rose again from June to September, feeding through to inflation. Inflation became apparent by October, and the market fell.
- Slowing AI growth fed through to neocloud, then to disastrous tech earnings reports—another link in the chain. Inflation was also an underlying factor in earnings falling short of expectations.
#BinanceCampus
