10 Essential Insights to Navigate and Thrive in a Bull Market

Economic

Summary:

Uncover the 10 must-know tips to succeed during a bull market. Learn how to identify the right opportunities, manage risks, and make the most of market highs with expert insights and data-driven strategies.

Bull markets represent periods when stock prices are generally rising, creating favorable conditions for investors seeking gains. Knowing how to effectively engage in a bull market requires more than optimism. It demands an understanding of market signals, strategies to maximize returns, and caution to avoid common pitfalls. Here are 10 essential insights to help you make the most of a bull market.

1. Understand the Definition of a Bull Market

A bull market is typically defined by a rise in stock prices of at least 20% from recent lows, driven by investor confidence, strong corporate earnings, and favorable economic conditions. These periods are usually characterized by optimism and expectations for sustained growth. Knowing this benchmark helps you identify bull markets early.

2. Recognize Key Indicators of a Bull Market

Bull markets are often preceded by economic indicators such as high GDP growth, low unemployment, and increased consumer spending. The U.S. Federal Reserve often supports these conditions with low interest rates, which encourages borrowing and investing. For instance, during the 2009–2020 bull market, low-interest rates and steady GDP growth fueled confidence across the market.

3. Invest with a Long-Term Mindset

Bull markets provide an opportunity to gain from price appreciation, especially if you are willing to hold onto investments for an extended period. Warren Buffett, one of the most successful investors, emphasizes the importance of long-term investing, particularly during periods of growth. Patience allows investors to avoid short-term volatility and benefit from sustained price increases.

4. Diversify Your Portfolio to Minimize Risk

Even in a bull market, risks exist. Diversification across various asset classes—such as stocks, bonds, commodities, and real estate—can help minimize potential losses if certain sectors underperform. Historically, sectors like technology and consumer discretionary perform well in bull markets, so a balanced portfolio should consider these alongside defensive assets.

5. Pay Attention to Overvaluation Risks

Bull markets sometimes lead to overvaluation, where stock prices surpass their actual value. Investors can use valuation metrics such as the price-to-earnings (P/E) ratio to gauge whether a stock is overvalued. The dot-com bubble of the early 2000s is an example of how overvaluation can precede a downturn. Stay vigilant about inflated prices and avoid stocks with unusually high P/E ratios.

6. Watch for Sector Rotations

As bull markets progress, investors may shift focus from one sector to another. For example, technology may lead early in a bull market, while financial and industrial stocks may gain momentum as economic growth strengthens. Monitoring sector rotation helps you identify new opportunities and shift investments to maximize returns across different stages of the market cycle.

7. Be Ready for Market Corrections

A bull market doesn’t mean prices rise indefinitely. Corrections, or short-term declines, are common and can range from 5% to 15%. These can be opportunities to buy strong stocks at lower prices. For instance, during the 2009-2020 bull market, the market experienced several corrections that savvy investors used to buy additional shares at a discount.

8. Consider Dividend Stocks for Steady Income

Dividend-paying stocks are valuable in bull markets as they provide a steady income while allowing for capital appreciation. Companies with strong dividend histories, such as Johnson & Johnson and Coca-Cola, can be excellent additions, offering a buffer during any market pullbacks while still benefiting from the general upward trend.

9. Use Stop-Loss Orders to Manage Risk

Bull markets may entice investors to take on more risk. However, setting stop-loss orders can protect you from significant losses if the market suddenly reverses. This is especially useful for high-volatility stocks, which may have steep climbs but also sharp declines. Stop-loss orders ensure you’re prepared for any abrupt downturns while riding the upward momentum.

10. Stay Informed and Adjust Your Strategy as Needed

The final piece of advice for navigating a bull market is to remain informed and adapt your strategy based on current market conditions. Keep up with economic data, Federal Reserve policy, and corporate earnings reports. Investors who adjust their portfolios to reflect changes in economic conditions, such as inflation rates or changes in interest rates, are better positioned to maintain gains over the long term.

Data Insight: Bull Market Returns

Historically, bull markets have returned an average of 180% over a 5-year period, making them ideal times to capitalize on the appreciation in stock values. For instance, the longest bull market in U.S. history from 2009 to 2020 saw the S&P 500 index surge by over 400%.

Final Thoughts

While bull markets present lucrative opportunities, they require strategic planning and risk management. By staying informed, diversifying your portfolio, and recognizing overvaluation signals, you can make the most of a bull market while minimizing potential risks. Prepare your investment approach accordingly, and remember that all market cycles eventually end—so it's essential to lock in gains and remain vigilant as conditions evolve.

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Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

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Warren Takunda

Economic

Political

A potential 10% tariff on all European Union goods exported to the United States, a key proposal from Donald Trump in his 2024 re-election campaign, could profoundly impact Europe’s export-driven industries and disrupt its largest overseas trade relationship.

As EU exporters brace for possible obstacles, data from the European Commission underscores the economic vulnerabilities at stake, with Germany, Italy, and Ireland leading the list of countries most affected.

How crucial are European Union exports to the US?

Although China surpassed the United States (US) as the European Union’s top goods partner in 2020, the US remains Europe’s largest overall trading partner when services and investment are included.

According to European Commission data, the European Union exported €502.3 billion in goods to the US in 2023, making up a fifth of all non-European Union exports.

Moreover, the European Union is a net exporter of goods to the US, with a positive goods balance of about €158 billion in 2023.

The American market is especially vital for major European economies like Germany, Italy, and Ireland,

Germany alone accounted for €157.7 billion in exports to the U.S. in 2023. Italy and Ireland followed with €67.3 billion and €51.6 billion in exports, respectively. How Could Trump’s Proposed 10% Trade Tariff Affect EU Exports to the US?_1

How Could Trump’s Proposed 10% Trade Tariff Affect EU Exports to the US?_1

Which European sectors are most at risk?

European exports to the US are led by machinery and vehicles (€207.6 billion), chemicals (€137.4 billion), and other manufactured goods (€103.7 billion), which together comprise nearly 90% of the bloc's transatlantic exports.

According to the European Commission, these sectors were responsible for a significant trade surplus in 2023, with €102 billion in machinery and vehicles and €58 billion in chemicals. How Could Trump’s Proposed 10% Trade Tariff Affect EU Exports to the US?_2

How Could Trump’s Proposed 10% Trade Tariff Affect EU Exports to the US?_2

Breaking down the export categories, medicinal and pharmaceutical products led in 2023 with €55.6 billion, followed by motor vehicles at €40.7 billion and medicaments at €36.1 billion. How Could Trump’s Proposed 10% Trade Tariff Affect EU Exports to the US?_3

How Could Trump’s Proposed 10% Trade Tariff Affect EU Exports to the US?_3

Germany and Italy, as Europe’s leading producers of machinery and vehicles, face particular risk.

Automotive exports, a critical segment of Germany’s economy, could experience a drop in US demand due to price increases, further weakening an already stagnant the sector and jeopardising jobs.

Should a 10% tariff be imposed, these industries face potential loss of competitiveness due to an increase in final costs, risking production slowdowns and job cuts if US consumers turn to other markets for these goods.

For European industries, the threat of US tariffs comes at a time of existing economic strain, as the bloc’s manufacturing output has been consistently shrinking over the last two years.

What impact would tariffs have on the EU-US trade balance?

Following Russia’s invasion of Ukraine and the European Union’s pivot away from Russian energy, the US has become an essential supplier of oil and natural gas, leading to a growing trade deficit in energy imports.

This shift created an energy goods deficit of €70 billion in 2023, and a 10% tariff on European Union exports would likely further exacerbate this imbalance, diminishing the overall trade surplus with the U.S. and impacting economic growth within the bloc.

This effect would likely be exacerbated if the dollar were to strengthen significantly against the euro as a result of trade tariffs.

In addition to goods, European Union’s services trade with the U.S. is also in a vulnerable position.

According to the European Commission, the European Union registered a €104 billion deficit in services with the U.S. in 2023, a gap that has widened each year since 2021.

Although the service sector would likely feel less direct impact than goods under a tariff regime, any retaliatory measures or escalation of trade barriers could disrupt sectors like finance, tourism, and professional services, which are critical to the EU's service-oriented economies.

Could European countries retaliate?

If Trump proceeds with the proposed tariff, the European Commission may consider a range of countermeasures to protect European exporters.

Possible responses include retaliatory tariffs on U.S. goods or diversifying trade partnerships to reduce reliance on the American market.

However, European leaders are cautious of actions that could worsen the situation and disrupt well-established economic ties between the two economies.

Retaliation or intensified tariffs could lead to production slowdowns in key export sectors, pushing some European nations to prioritise resilience by exploring new trade relationships in Asia or expanding intra-European demand for their exports.

Source: Euronews

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Warren Takunda

Economic

Chancellor Rachel Reeves will announce significant tax rises (GBP negative) and increased infrastructure spending (GBP positive). We are interested in which side of the equation dominates, as this could potentially impact the direction of the FX market in the coming days.

Reeves wants to fill a £22BN budget deficit and will increase the National Insurance contributions (NICs) paid by employers to the government. Reeves will also announce the minimum wage will rise by an inflation-busting 6% next year.

This will heap pressure on businesses, with a report in the Times warning businesses see a "perfect storm" blowing their way.

"If employing more people is not only more expensive (NIC increases) but also more difficult and risky (Employment Rights Bill), businesses will be reluctant to hire more people, particularly those who have been out of work for a long time," says Rupert Soames, chairman of the Confederation of British Industry.

"The crux of the matter is that such measures would increase the cost of employing, and hiring, workers in the UK. The net result would likely be that businesses either hire fewer workers due to the additional expense, or that pay grows at a slower pace. In other words, this measure would be a huge tax on both businesses, and employees," says Michael Brown, a strategist at Pepperstone.

A rise in unemployment following the budget could potentially weigh on wages, allowing the Bank of England to cut interest rates faster.

This would weigh on the Pound in the medium term.

"A negative reaction to the budget would cause Gilt yields to rise and GBP to fall, but we do not expect a large reaction because the change has been flagged for weeks," says strategist Kristina Clifton at Commonwealth Bank.

Investment bank consensus forecasts update: The end-2024 and 2025 guide from Corpay has been released. It shows a sizeable uplift was made to the consensus forecasts for GBP/EUR.

Additional Spending

However, for now, the Pound is reflecting some optimism amongst market participants, likely centred on the additional spending that will be announced to fund infrastructure investments.

The Pound to Euro exchange rate spiked to 2024 highs at 1.2050 ahead of the budget but was unable to hold the gains and is back at 1.2017 at the time of writing, confirming our suspicion that the 1.20 level will remain an equilibrium level for the time being.

The Pound to Dollar exchange rate rallied to 1.30 again over the course of the past few sessions amidst Sterling strength and a selloff in the Dollar linked to weaker-than-forecast job opening numbers in the U.S.

Pound Sterling Rises Against Euro and Dollar as Markets Focus on Expected Positives in Budget_1

Image courtesy of Pantheon Macroeconomics.

Reeves is expected to alter the definition of the government's debt rule to allow up to around an extra £50BN in infrastructure spending.

The change is long overdue as the public sector is in dire need of investment, given this form of spending is usually the first to be cut when governments are looking for cost savings.

"A change to the measure of government debt has been flagged to allow more room to spend on infrastructure," says Clifton. "While the UK budget deficit is expected to improve over the coming years it will likely remain large. The large budget deficit may mean that the Bank of England does not need to reduce interest rates by as much as some of the other central banks."

Analysis from Pantheon Macroeconomics suggests the government will deliver "looser fiscal policy" in the October 30 Budget, which will boost GDP by 0.5% in 2025/26.

"As a result, the MPC will need to hold Bank Rate 25-to-50bp higher than it would otherwise," says Robert Wood, Chief UK Economist at Pantheon Macroeconomics.

Pound Sterling enters the budget as one of 2024's best-performing major currencies owing to the cautious approach to interest rate cuts adopted by the Bank of England amidst better-than-expected economic data outturns in the first half of the year.

A well-received budget and a steady approach to rate cuts at the Bank can underpin Sterling's outperformance, particularly against the Euro and other European currencies.

Pantheon thinks Chancellor Reeves will raise government borrowing by an average of £17.2B per yea - 0.5% of GDP to boost tight day-to-day government spending plans.

Additional expenditure will be covered by tax hikes, but the Chancellor will borrow additional amounts to fund investments.

Source: Poundsterlinglive

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SAXO

Economic

Central Bank

Rate Cuts vs. Long-Term Yields: The Disconnect Explained

While short-term yields tend to move in response to central bank policies, long-term yields are influenced by expectations of a country’s nominal growth. This means that even if the Bank of England (BoE) enacts significant rate cuts, the short end of the yield curve will likely respond predictably, whereas the behavior of long-term yields remains uncertain. Long-term yields could rise if markets expect robust economic growth or persistent inflation.

The upcoming UK Autumn Budget could be a catalyst for such expectations. Should the Budget reveal higher-than-expected fiscal spending, bond markets might anticipate greater inflationary and growth pressures, likely pushing long-term yields higher. This could also slow down the BoE’s rate-cutting cycle, raising yields across the yield curve, especially at longer maturities.

In this context, maintaining a cautious stance on duration is prudent. However, shorter-term bonds like the 2-year Gilt, currently yielding 4.2%, are appealing, as they reflect anticipated rate cuts over the next two years. This yield, which is pricing in fewer rate cuts than swap markets, presents a favorable opportunity carrying less risk. With a 1-year holding period, the breakeven yield of around 8% implies that the BOE would need to resume hiking rates by over 300 basis points for this investment to incur a loss—a scenario that appears unlikely given the BoE's current outlook.

Why UK Gilt Yields May Rise Despite BoE Rate Cuts: Structural and Economic Pressures at Play

Several structural and economic factors suggest that gilt yields may rise despite the BoE’s rate cuts:

SONIA Curve Expectations vs. Economic Conditions: The SONIA curve shows market expectations for the BoE to lower rates from 5% to 3.75% by late 2025. However, with real GDP growth of 0.7% year-on-year and sustained core inflation above 3%, the UK’s macroeconomic backdrop does not support aggressive rate cuts. Robust wage growth (at 5%) could keep consumer spending strong, potentially boosting growth and exerting upward pressure on bond yields.

Increased Gilt Issuance: This fiscal year gilt issuance is projected to increase by £15 billion, reaching £293 billion—the highest level outside of the pandemic. Over the next five years, total issuance could rise by £70 billion, which may increase gilt supply and place upward pressure on yields as the government competes for investment. This increased borrowing may reduce the attractiveness of gilts among investors.

Persistent Inflation Expectations: While inflationary pressures have softened, the 10-year UK breakeven rate remains around 3.5%, indicating that inflation concerns persist. This elevated level, relative to pre-Covid norms, could lead investors to demand higher yields to protect against purchasing power erosion, further complicating the BoE’s objective of managing long-term yields downward.

Will the Gilt-Bund Yield Spread Break 200bps? Autumn Budget Uncertainty and Diverging Fiscal Policies Add Pressure

The Gilt-Bund yield spread has widened considerably, highlighting the economic and fiscal differences between the UK and Europe. The spread has repeatedly tested the 200 basis point (bps) threshold, only to face resistance, indicating that market dynamics limit its ability to remain above this level for long periods.

For a sustained break above 200 bps, several conditions would need to converge, including increased UK gilt issuance alongside stable or reduced Bund issuance, as well as relatively higher inflation or growth in the UK versus the Eurozone. The UK’s Autumn Budget may drive short-term volatility and could push the spread to test this level again. However, consistent widening would likely require enduring economic or fiscal divergences between the UK and Europe.

Looking further ahead, German fiscal policy could impact this spread as well. Germany’s 2025 general election may lead to fiscal expansion, which could increase Bund issuance and support narrowing the Gilt-Bund spread. This potential increase in Bund supply could counteract some of the spread's widening, reinforcing resistance around the 200 bps level.

This is why we expect the spread to remain elevated, but not to break sustainably above 200 bps unless the Autumn Budget shows a much larger fiscal package than what markets expect.

Rate Cuts and Rising Yields: The BoE’s Budget Dilemma_1

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ING

Commodity

Economic

Metals – Gold hits another record high

Gold hit another record high this morning, topping the all-time peak set just yesterday, climbing to $2,789.86/oz.

Gold’s rise comes despite rising bond yields and a strong US dollar – typically a headwind for the precious metal, as the market awaits US data at the end of the week, including inflation and payroll figures, for clues on the pace of Fed rate cuts.

Gold has been one of the best-performing commodities this year, surging by more than 30%. It is supported by central bank buying and safe-haven demand amid conflicts in the Middle East and Ukraine. Uncertainty ahead of the US election next week has also supported gold’s record-breaking rally this year, and we believe it will continue to add to gold’s upward momentum. Expect more volatility in the days to come, as uncertainty around future US policies likely leads to a flight into safe havens.

The Shanghai Futures Exchange (ShFE) has raised its margin requirement for alumina trades from 11% to 12% and widened the daily trading band to 10% from 9% in an effort to cool down the rally in alumina prices. Chinese alumina futures have rallied over 50% this year to trade above CNY5,100/t at one point yesterday, following disruptions from top miner Guinea. Meanwhile, Beijing Antaike expects that higher prices will help to lift Chinese alumina production by 4% to 85.6mt this year. However, production growth softened over the first nine months due to supply tightness of feedstock bauxite.

Rio Tinto Group has suspended operations at its Simfer port, which caters for the Simandou iron ore mine in Guinea, due to a fatal accident over the weekend. Simandou has one of the world’s largest iron ore deposits, and its Simfer mine is on track to deliver its first production in 2025, with an annual output capacity of 60mt.

The latest LME COTR report released yesterday shows that investors boosted the net bullish position for aluminium by 6,845 lots for a second consecutive week to 127,323 lots for the week ending 25 October. This is the highest net long since 14 June 2024. Similarly, the net bullish bets for zinc rose by 1,039 lots to 39,067 lots at the end of last week, the highest since the week ending on 31 May 2024. Meanwhile, money managers decreased net bullish bets for copper by 4,939 lots for a third straight week to 67,175 lots (the lowest since the week ending 13 September 2024) as of last Friday.

Energy – Bullish API report supports oil

NYMEX WTI and ICE Brent edged higher in today’s morning trading session, as API’s weekly inventory report suggested unexpected draws for US oil stocks. The focus remains on the OPEC+ production numbers and outlook and the group’s response to recent price weakness.

Numbers from the API overnight showed that US crude oil inventories fell by 573k barrels over the last week. Meanwhile, refined products also witnessed draws, with distillate and gasoline inventories falling by 1.46m barrels and 282k barrels, respectively. The more widely followed EIA weekly report will be released later today.

Meanwhile, data from Mysteel OilChem shows that Chinese refiners and fuel suppliers plan to cut their oil product exports in November due to low margins and weaker demand for products in the global markets. The country could decrease exports by around 12% month-on-month to 2.54mt next month with major cuts likely for gasoil and kerosene exports.

Agriculture – ISMA requests to allow sugar exports of 2mt

The Indian Sugar and Bio-energy Manufacturers Association (ISMA) requested the government to permit the immediate export of 2mt of sugar, anticipating plenty of supply in the domestic market. The group also asked the authorities to establish a long-term export policy to regulate the surplus. The opening stock estimates for 2024/25 are around 8.4mt, while sugar production stood at 33.3mt. The association expects an excess inventory of around 3.1mt-3.2mt by the end of the 2024/25 season, compared to 5.5mt at the end of last season, while sugar consumption is expected to average around 33.1mt-33.2mt.

Data from the European Commission shows that EU soft-wheat exports for the 2024/25 season dropped to 7.3mt as of 25 October, down 33% compared to 10.9mt reported in a similar period a year ago. The fall in exports could be primarily attributed to the declining domestic production for the ongoing season. Nigeria, Egypt, and Morocco were the top destinations for these shipments. In contrast, EU corn imports continued to rise and increased to 6.4mt, up 8% compared to a year ago. These stronger inflows are a result of weaker domestic supply this season.

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Cohen

Cryptocurrency

Economic

SEC Lawyer Movements Highlight the Agency’s Bias Against Crypto

On Tuesday, October 29, Fox Business journalist Eleanor Terret shared an article about former SEC lawyers changing allegiance and moving to crypto-related firms.

Terret named Ladan Stewart as one of four SEC enforcement lawyers who left the agency for firms representing crypto clients. Ladan Stewart reportedly worked as an SEC enforcement lawyer for eight years before joining White & Case.

Speaking at a Crypto Investor Day event, Stewart said,“When you come to this side and you realize that there are people who really want to find a way to work with regulators, and they feel like that’s just not possible, given you know who is at the helm of the SEC or generally the Biden administration. I think it’s just unfortunate, and it gets in the way of any effort toward reaching some regulatory clarity or anything that allows us to work toward building this industry.”

Coinbase (COIN) Chief Legal Officer Paul Grewal remarked,“I never am at a loss for words. Until now…”

Amicus Curiae attorney and candidate for the United States Senate in Massachusetts John E. Deaton shared his experience of the SEC, stating,“Just because you switch sides for monetary reasons doesn’t mean you get a free pass on the conduct you were part of during the last four years. Innocent investors, developers and users (including more than $15 billion) were harmed, and continue to be harmed, by that conduct.”

Increasing scrutiny of the SEC and its reign of regulation through enforcement contributed to a positive Tuesday crypto session. Rising hopes of a Trump return to the White House fueled demand for crypto assets, including XRP.

XRP Price Action

On Tuesday, October 29, XRP advanced by 1.72%, following a 0.46% gain from the previous session, closing at $0.5278. While XRP extended its winning streak to four sessions, it remained below the crucial $0.55 level for the eighth consecutive session. XRP underperformed BTC and the broader crypto market, which gained 3.33%, taking the market cap to $2.303 trillion.

Rising hopes for a Trump return to the White House could further boost XRP demand. Trump said he would fire SEC Chair Gensler on day one, potentially ending the SEC’s appeal against rulings in the Ripple case. A decrease in Trump’s electoral chances might enable the SEC to pursue its appeal, potentially dropping XRP below $0.50.

XRP News Today: SEC Scrutiny and Trump Election Bets Drive XRP and BTC Demand_1

Bitcoin Retakes the $73,000 Handle on Trump Election Bets

While XRP advanced, BTC revisited the $73,000 handle for the first time since March 2024, nearing its all-time high of $73,808. Rising bets on a Trump return to the White House drive demand for BTC.

According to the latest national polls, Kamala Harris leads Trump by just 1.4 points, down from 1.8 points on October 23 and 2.8 points on September 30.

Despite Kamala Harris voicing support for crypto, Trump remains the crypto market’s president of choice. Trump has offered several promises targeting the crypto vote, including firing SEC Chair Gary Gensler on day 1 and making BTC a strategic US reserve.

US BTC-spot ETF Market Extends Inflow Streak

Sentiment toward the US Presidential Election has likely fueled demand for US BTC-spot ETFs. Some investors may view US BTC-spot ETF flows as an indicator of sentiment toward the US election results.

On Monday, October 28, the US BTC-spot ETF market saw net inflows of $479.4 million, with issuers reporting another positive session on Tuesday. According to Farside Investors:

Fidelity Wise Origin Bitcoin Fund (FBTC) saw net inflows of $133.9 million on Tuesday, October 29. (Previous day: +$44.1 million).Bitwise Bitcoin ETF (BITB) had net inflows of $52.5 million. (PD: +$38.7 million).Grayscale Bitcoin Mini Trust (BTC) saw net inflows of $29.2 million. (PD: 21.6 million).ARK 21Shares Bitcoin ETF (ARKB) reported net inflows of $12.4 million (Previous day: +$59.8 million).

Excluding iShares Bitcoin Trust (IBIT) flow data, the US BTC-spot ETF market had total net inflows of $227.2 million on October 29, down from $479.4 on October 28. Notably, IBIT had net inflows of $315.2 million on October 28, possibly setting the stage for US BTC-spot ETF market inflows to reach approximately $500 million on October 29.

Bitcoin (BTC) Price Action

On Tuesday, October 29, BTC rallied 4.11%, following a 2.63% gain from the previous session, to close at $72,628. Significantly, BTC extended its winning streak to four sessions.

On Wednesday, October 30, US economic indicators, including Q3 GDP and ADP employment data, require consideration. Weaker-than-expected data could raise investor bets on a 25-basis point December Fed rate cut. A more dovish Fed rate path and expectations for a soft US economic landing could boost demand for riskier assets.

Positive sentiment could fuel buyer appetite for US BTC-spot ETFs, potentially driving BTC toward $75,000. Additionally, US Presidential Election-related news could influence BTC price trends. A narrowing in the national polls could drive buyer appetite for BTC and spot ETFs. XRP News Today: SEC Scrutiny and Trump Election Bets Drive XRP and BTC Demand_2

XRP News Today: SEC Scrutiny and Trump Election Bets Drive XRP and BTC Demand_2

Source:FXEMPIRE

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SAXO

Economic

Macro:

The US JOLTS headline Job Openings fell to 7.443mln from the prior revised down 7.861mln, well beneath the consensus of 8.0mln. This saw the vacancy rate fall to 4.5% from 4.7%, while the quits rate fell to 1.9% from 2.0%. Overall, the survey continues to have a very low response rate.

US consumer confidence came in strong as it printed, 108.7, the most since March 2021 on optimism about the broader economy and the labor market. A measure of expectations for the next six months rose in October to 89.1, the highest since December 2021. A gauge of present conditions increased more than 14 points, the largest monthly advance since May 2021.Reports suggested that Chinese officials will announce 10 trillion-yuan ($1.4 trillion) package in fiscal stimulus in the coming week as officials meet Nov 4-8. The details of the package were, however, weaker. Firstly, the spending will be spread over three years 2024, 2025 and 2026. Secondly, 6 trillion yuan of that, or 60%, is earmarked for helping local governments with their debt. That raises more questions than it answers and points to deeper problems at the local level than understood. The next 4 trillion yuan will be used for property purchases over five years as part of the government's plan to buy up unused properties for low-income housing. This would still mean a limited immediate consumption boost.

Equities: US markets saw the Nasdaq Composite reach new record highs, rising 0.78% as investors maintained optimism ahead of this week’s big tech earnings and the upcoming US elections on November 5. Google jumped more than 5% after reporting earnings after the close yesterday as the company noted that its heavy investment in AI at its data centres is paying off with a surge in its cloud business. AMD’s earnings met expectations, but shares dipped 7% after providing unexciting Q4 guidance. In Asia, the Nikkei 225 gained 0.77%, buoyed by a weaker yen amid Japan’s ruling coalition losing its lower house majority, potentially impacting BOJ’s policy stance. Today, the focus will be on the two Mag-7 companies Microsoft and Meta reporting after the close, with Eli Lilly reporting before the market open and focus there on the growth in its obesity drug. Volkswagen has already been out reporting earnings this morning and posted its worst profit margin since the pandemic on slumping sales in China.

Volatility: The VIX fell 2.32% to 19.34, reflecting a moderation in broader market volatility expectations. The VIX1D, a measure of one-day volatility, rose by 12.76%, suggesting elevated uncertainty in the immediate term as major tech earnings and economic data approach. Today's implied moves for the SPX and NDX stand at roughly 30 points (0.52%) and 168 points (0.82%), respectively, indicating expected movement around these levels for the day. Upcoming earnings from key players like Microsoft, Meta, Eli Lilly, and Caterpillar are poised to impact market sentiment and could drive intraday volatility. In the options market, notable activity surrounds AMD, Alphabet, Ford, and Pfizer, primarily due to their recent earnings reports, as traders adjust their positions in response to corporate performance metrics.

Fixed Income: European sovereign bonds yields rose as traders anticipated increased fiscal spending in the US and UK. German 10-year real yields rose to 0.47%, their highest since July, while UK gilts dropped ahead of Wednesday’s budget, pushing the UK 10-year real yield to a one-year high at 0.82%. U.S. Treasuries ended Tuesday mostly unchanged after initially falling. A $44 billion auction of 7-year notes showed strong demand with yields dropping slightly afterward. The auction stopped through When Issued, indicating high interest, and had one of the highest bid-to-cover ratios on record. This result spurred a bond rally till the end of the day. The 10-year yield settled around 4.28%, down from an earlier high of 4.33%.

Commodities: Gold reached a fresh record near USD 2,800, supported by continued uncertainty about the US election outcome, and after mixed US economic data drove US bond yields lower. Also, the market continues to price in a 25-bps rate cut on 7 November. Gold demand climbed to 1,313 tons in the third quarter, according to the World Gold Council, with strong investment demand from the West offsetting waning appetite from Asia. Crude trades steady after two-day decline with focus on EIA’s weekly stock report while traders are split on whether OPEC+ will go ahead with a December production increase. A possible fresh stimulus boost in China gave copper brief boost. Chicago wheat rise on disappointing winter wheat conditions while harvest pressures weigh on soybeans.

Currencies: US dollar strength yesterday was partially reversed against the major currencies, with the EUR/USD exchange rate seemingly unable to punch below 1.0800 and stay there. Sterling is at the stronger end of the range versus the euro ahead of today’s important autumn budget statement with Chancellor Rachel Reeves. And huge anticipation ahead of tonight’s Bank of Japan meeting, as the market awaits guidance on how the BoJ sees the policy trajectory from here, particularly any hints on whether a rate hike at the December meeting rate could be in play.

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