Friday’s trades will ride on bullish momentum in Bitcoin (BTC-USD) coupled with Thursday’s unexpectedly strong December inflation report.
BTC traded at between $46,465 to $48,700 in the span of around two hours after the SEC approved a spot Bitcoin ETF. The biggest cryptocurrency is conflicted between the prospects of higher interest rates and higher demand after ETF trading starts.
The volatility puts crypto miners and platforms in a precarious spot. Marathon Digital (MARA) traded in a wide range of between ~ $22 - $29 on Thursday. Coinbase (COIN), a popular crypto platform, is now accelerating in a downtrend.
Traders may take advantage of the volatility in COIN, MARA, and BTC-USD.
In economic news, the BLS posted U.S. December 2023 inflation up by 0.3% month/month and 3.4% annually. This is higher than the previous report. It completely decimates the “guaranteed” interest rate cuts that the media bet would happen in 2024. Investors in the S&P 500 (SPY) and Nasdaq (QQQ) are unlikely to take profits from here. Both index ETFs are up significantly since the downtrend that ended at the end of Oct. 2023.
The high food and shelter costs will erode corporate profits. Beware of consumer discretionary stocks like Proctor & Gamble (PG), Johnson & Johnson (JNJ), Coke (KO), and Pepsi (PEP). These firms cannot keep raising prices to expand their profit margins
