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“Markets Daily” kicks off a new format with a minute of market updates, followed by an interview with a rotating cast of market analysts across the crypto space. Today, host Jennifer Sanasie speaks with Markus Thielen about a potential March BTC slump, clarifications on two leaked investor reports and a bullish price prediction for bitcoin at the end of 2024.
This episode was hosted by Jennifer Sanasie. “Markets Daily” is executive produced by Jared Schwartz and produced and edited by Eleanor Pahl, alongside Senior Booking Producer Melissa Montanez. All original music by Doc Blust and Colin Mealey.
Audio Transcript: This transcript has not been edited and may contain errors.
JENNIFER SANASIE:
It’s Thursday, January 4 2024, and this is “Markets Daily” from CoinDesk. I’m your host Jennifer Sanasie. Let’s dive into those prices. According to CoinDesk indices at 8 a.m. Eastern Time, bitcoin was trading up 1.7% over the past 24 hours at $43,416. Ether was nearly flat over the same time period at $2,237. Today’s mover in the CoinDesk Market Index is the Ethereum Name Service, ticker ENS, up over 50% on the day. In traditional markets, stocks extended their second day of losses as the NASDAQ fell 1.18% yesterday, while the S&P 500 slipped 0.8%. And in commodities, the Brent crude oil benchmark fell slightly, trading at $73.36 a barrel as of 8 a.m. Eastern Time. Meanwhile, gold was trading at $2,053 an ounce, nearly flat on the day. For more on the markets action, let’s bring in Matrixport Head of Research and Strategy Markus Thielen.
MARKUS THIELEN:
Good morning. Thanks for having me.
JENNIFER SANASIE:
Thanks for being here. Now I gotta get you to clear something up for us right off the bat. Matrixport recently said that they expect the SEC to reject all ETF applications. But people on X are a little bit upset, Marcus, because earlier this month, just before this report came out, Matrixport also said that we can expect bitcoin to hit $50,000 because of the anticipation of spot bitcoin ETF. So which one is it? How are you thinking about this?
MARKUS THIELEN:
Yeah, thanks for giving me the opportunity to clarify. Yeah, of course, our reports for clients. So you know, it’s a little bit unfortunate that those reports were leaked, really, because what we wanted to do is really just explain to our clients what we think is going to happen. And, of course, the reports that were leaked, it’s mostly the cover pages didn’t really say much. So our view has changed based on two components. Number one, there’s actually a change in the market structure and some technical signals that we have. And I can elaborate on this a little bit further. But also, we didn’t see the improvements in the filings in the S1 filings from the issuance. While we expected based on the historical analysis over the last three halving cycles, what we usually tend to have is we have a strong kind of the rally for the beginning of the year, and then we have a fake out. And then we make a low in March. And what actually happened, we were expecting, we were hoping that we could squeeze in the beginning in the first couple of days, really into the new $50,000 level. But what of course happened is that, you know, the U.S. stock market started to sell off. So the momentum was not there from a broad, liquidity and asset side, and then we got a technical signal. So we run, you know, something like 40+ models, like every day around the top 100 tokens. And for the first time since basically August last year, we started to have a bearish signal for bitcoin. And this, of course, made us very, very cautious because, you know, the probability is quite high that this is like a successful, you know, signal. And of course, we expected that this rally was petering out. And the two reports you are referring to one was issued on Tuesday, and one was issued on Wednesday, after the signal. So there was, of course, a 24 hour difference between those reports. But for us, it was really like a mild difference. But also, as I was saying, since Dec. 8, we have been warning that there could be some range trading and some kind of you know, profit taking ahead of any approvals. And that’s kind of emphasized in terms of how people should manage the risk, how people put on position. And the report we issued yesterday, was emphasizing that investors can use put options and really protect your portfolio because we could see a really large move up or down and we kind of expected the move, potentially be down because we’re still kind of cautious if these ETFs are really going to be approved.
JENNIFER SANASIE:
Alright, so Marcus, it sounds like you’re saying bearish times ahead while the majority of the folks I’ve spoken to recently think that we are kicking off a bull market.
MARKUS THIELEN:
Well we still remain bullish for this year. We just expect, you know, a hiccup and a push out of some of the these decisions are on the ETF and as I was saying, this goes very much in hand of with the pattern analysis that in these, you know, halving years, you tend to see like a decline into sort of like the March period before the market starts to rally. And again, you’re looking at, for example, how the NASDAQ is performing in the first couple of trading days. I mean, this doesn’t mean it looks like a super bullish environment right now. So that’s why I think it’s sort of from a trading perspective it is warranted and we were just simply highlighting from a risk management perspective. It just makes sense to put an equity portfolio for something like 1.6%. And just kind of like wait, wait out this period.
JENNIFER SANASIE:
All right now tell us a little bit more about that technical analysis. How does that actually relate to the SEC’s pending decision? Why do you think that the SEC might reject all spot ETFs? Talk to us about this technical analysis and the SEC.
MARKUS THIELEN:
It’s a technical trading model that looks at patterns. And the pattern was indicating that, you know, the future return over the next two weeks is a 7% decline to something like $42,000. And it just kind of was filling kind of like the toolbox that we’re using from kind of these trading systems are trading signals, as well as market structure analysis and market structure analysis, for example, do we see liquidity coming into the market or leaving the market? Do we see, for example, the funding rates being massively high the funding rates crossed over 60%. And of course, then, open interest has also increased from something like $7 billion to $12 billion. So there have been a lot of long positions in the market. And the way how we were trading, you know, in the first couple of days of the year was really, that it’s all futures driven. And we sort of felt through our market structure analysis, that the market is quite vulnerable. Plus, then of course, we got the signal from our trading system that would indicate that we might see a selloff which, you know, we kind of got.
JENNIFER SANASIE:
And what should investors and traders be looking at closely this morning? If we look maybe outside of bitcoin in the potential ETF, what should traders be watching?
MARKUS THIELEN:
Yeah, I mean, we have been very focused on the volatility market, right on the option market, how people are positioned, you know, where they’re focusing on. Otherwise, of course, if we get the approval for an ETF, you know, we think the momentum will shift very quickly into Ethereum. Because Ethereum would be up for for the next round of potentially approvals by May and you would expect then you’re going to see some large outperformance of Ethereum over bitcoin, we haven’t really seen over the last kind of like one or two weeks that the bitcoin dominance ratio has declined from 53% to near 50%. So 50%, more or less aligned in the sense that it’s really kind of an altcoin season that the bull market is broadening out. And we do expect higher prices occurring this year, and probably a new high for this year, as you know, you know, I’ve been very bullish on the market. But we also try to trade the small kind of momentum or events where we think the market is vulnerable. And we just tried to be, you know, smart in terms of a risk management approach.
JENNIFER SANASIE:
Let’s talk about a year from now, I’m glad you brought up Ethereum. Of course, there’s a spot ether ETF also pending that I’m sure we’ll be talking about once the spot bitcoin ETF is proved, but a year from now, what does the price of bitcoin look like? And on the other hand, what does the price of ether look like?
MARKUS THIELEN:
Well, we hope that it’s gonna get closer to $100,000. Of course, we expect that eventually, these ETFs will be approved, we just think there is like a key component potentially missing in the approval process, but it might be pushed out in a couple of months. So we’re not saying this is never going to happen. We just think that it might not be all fulfilled, what the SEC is really looking for. And in that case, it might take a couple of more months, but I think then we expect the market to really broaden out. And you know, to rally another set, we probably make it make a new high return.
JENNIFER SANASIE:
All right, what’s that new high, though? End of 2024? December 2024? What’s the price of bitcoin?
MARKUS THIELEN:
We tend to think it’s going to be you know, $80k. Of course, it’s a moving target. I mean, last year we got to pretty much spot on. So I don’t think we got to be, you know, as successful as last year was our prediction, but I think we’re gonna make a new high and I think, you know, 100% from here is possible when you look at these last three having cycles, 2012 2016 and 2020, bitcoin actually rallied nearly 200%. So 200% this would get us to, you know, $120,000. But I think if you’re not too greedy and be happy with 100%, it’s gonna get us to $80,000. So I would, I would bet to be going to get to $80,000
JENNIFER SANASIE:
I know, last year when you made that prediction, I was a little bit skeptical. And then as the price of bitcoin started to rally near the end of the year, I thought, I thought about you, Marcus, your prediction was pretty bang on last year. All right, and we gotta go. But what do you think the price of ether is going to be at the end of 24? Just really quickly.
MARKUS THIELEN:
I think it’s going to be slightly above $3000.
JENNIFER SANASIE:
All right, Marcus, thanks so much for joining us. Matrixport Head of Research and Strategy Markus Thielen. That’s it for today’s show.
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