Daily News | Mining Stocks Soared Though Crypto Gains Have Been Subdued As Fed Officials Signaled Interest Rates Above 5%

TL; DR

🥂 Good morning, today is Tuesday, Jan. 10, 2023. It’s going to be another great day. Let’s get after it relentlessly.

Macro: US equities saw mixed performance after Federal Reserve officials said the central bank may need to raise interest rates above 5% before pausing for a long time. Meanwhile, US consumer expectations for inflation in the next year have slightly decreased, according to a survey by the Federal Reserve Bank of New York. Lastly, despite the threat of economic contraction, American firms announced a record $1.26 trillion of buybacks in 2022, a 3% increase from the previous year.

Crypto: BTC edges up 0.41% to reach $17,198, while ETH sees a 2.23% increase to $1,318. Meanwhile, the total crypto market cap rose to $808.89B from $784.61B (+3%) since Sunday. As the S&P 500 and Nasdaq experienced a rare split in performance, most crypto-related equities followed the latter, with mining stocks outperforming the likes of MicroStrategy and Coinbase.

Topic of the Day: Ethereum Liquid Staking Protocols See Big Gains as Withdrawal Date Nears

Notable Headlines: US Department of Justice seized 55M Robinhood shares from FTX co-founders Sam Bankman-Fried and Gary Wang; Court documents show that 117 parties are interested in purchasing four FTX businesses such as LedgerX, Embed, FTX Japan, and FTX Europe; Germany’s financial regulator BaFin has reported that the GodFather malware has attacked 400 crypto and banking apps…

<_iframe_ title="Ethereum Shanghai Upgrade, Cardano Hospital, Fed Volatility, & More" src="https://www.youtube.com/embed/mtRS07qbf60" allow="autoplay; encrypted-media" allowfullscreen="true" data-time="251" data-date="2023-01-10" data-desc="In this video based on the Gate.io Blog, we discuss the recent Federal Reserve speakers, Ethereum's Shanghai Upgrade, Cardano ADA Charles Hospkinson's new hospital, and the FTX fallout affecting Solana's price." data-thumb="https://gimg2.gateimg.com/blog/167334160586725216320230110-170614.png">

Macro at a Glance: Fed Officials Signal Interest Rate Hike Above 5% as Stocks Struggle and Inflation Expectations Fall

Stocks stumbled after Federal Reserve officials signaled that interest rates could top 5%, dashing the hopes of traders who were hoping for a peak below that mark. The S&P 500 failed to maintain the key 3,900 level, reversing an advance that reached almost 1.5%. The Dow Jones Industrial Average underperformed, while the Nasdaq 100 rose thanks to gains in tech, with Tesla surging around 6%. The dollar and Treasury yields reduced their declines.

Federal Reserve officials Raphael Bostic and Mary Daly said on Monday that the central bank will likely need to raise interest rates above 5% before pausing and holding for a long time.

Bostic said that the Fed is committed to tackling high inflation and this warrants raising interest rates into a 5% to 5.25% range to reduce excess demand in the economy. Daly said she expects the central bank to raise interest rates to somewhere above 5%, though the ultimate level is unclear and will depend on incoming data on inflation.

Bostic added that if consumer price index data due on Thursday also showed inflation pressures easing, it could strengthen the case for reducing the size of rate increases to 25 basis points.

The US CPI report due on Thursday will be released a week after the latest jobs data showed that wage growth has slowed. These figures will be among the last that Fed officials will see before their meeting on January 31st and February 1st.

On the other hand, US consumer expectations for inflation in the next year have slightly decreased, according to a survey by the Federal Reserve Bank of New York. Expectations for inflation three years ahead remained unchanged at 3%. Median one-year-ahead inflation expectations fell by 0.2 percentage points to 5% in December, the lowest reading since July 2021.

Analysts at Goldman Sachs expect pressure on profit margins, changes to US corporate tax policies, and the likelihood of a recession to outweigh the positive impact of China’s economic reopening. However, the growing threat of an economic contraction has not stopped Corporate America from spending heavily on its own shares. American firms announced a record $1.26 trillion of buybacks in 2022, a 3% increase from a year ago, according to data from Birinyi Associates.

💡 Today’s Markets at Jan. 09 20:54 UTC

BTC +0.44% at $17,202; Ether +2.24% at $1,318.

Asia: Australia +0.60%; Japan Closed; Hong Kong +1.89%; China +0.58%; India +1.35%.

Europe: London -0.42%; Paris +0.68%; Frankfurt +1.25%.

US Spot Indices: Dow -0.30%; S&P -0.08%; Nasdaq +0.84%.

US Index Futures: Dow -0.32%; S&P +0.00%; Nasdaq +0.75%.

US Two-year Treasury down 5bps at 4.204%.

US Ten-year Treasury down 3bps at 3.530%.

UK Ten-year Gilt Bond up 3bp at 3.532%.

US Dollar Index -0.56% at 102.82.

FX in 24hrs: GBP: +0.78%; EUR: +0.87%; JPY: +0.24%; CNY: +0.98%.

Gold unchanged at 1,869; Light Crude +0.95% at 74.77.

🧠 Catalysts this week

Monday: France Balance of Trade, EU Unemployment Rate

Tuesday: Turkey Unemployment Rate, US Fed Chair Powell Speech

Wednesday: Australia CPI, Italy Retail Sales, US MBA 30-Year Mortgage Rate

Thursday ⭐️: **Australia Balance of Trade, China Inflation Rate, US Inflation Rate

Friday ⭐️: China Balance of Trade, UK GDP, Germany GDP, US Michigan Consumer Sentiment

Crypto Daily Digest: Mining Stocks Soared and Most Cryptocurrencies Have Seen Second Day of Consecutive Gains

Among the top 20 coins, Bitcoin (BTC) saw a modest increase of 0.41% to reach $17,198, while Ether (ETH) also increased by 2.23% to $1,318. The total crypto market cap rose 1.38% to $808.89B.

The top three winners were Cardano (ADA), which saw an increase of 4.88% to 0.312 following a 7.3% ascent on Sunday, Solana (SOL), which saw a strong increase of 13.49% to 16.42 following a 10.5% hike on Sunday, and GateToken (GT), which increased by 4.60 after seeing a 6.2% ascent in the past week.

In related news, Charles Hoskinson has announced the launch of a hospital that accepts ADA for payment. Meanwhile, Solana rose nearly 45% last week and launched a new memecoin known as BONK (+1,130%), which is meant to be a rival to Shiba Inu (SHIB), although it’s still too early to say if BONK is able to retain enough traction to get there.

The only loser among the top 20 coins as of late Monday is BNB which fell by 1.17% after rising nearly 13% in the past seven days. This comes after the Washington Post reported that U.S. authorities are requesting information from Binance into potential violations of money-laundering rules.

In an interesting and rare sight, the S&P 500 shredded 0.08% while Nasdaq rose by nearly 0.80%. This is likely due to the Dow Index falling by 0.34% which shared some listings with the S&P 500, implying some stocks have dragged down the latter while other stocks from Nasdaq balanced out the decline.

MicroStrategy (NASDAQ:MSTR) and Galaxy Digital (OTC:BRPHF) shares rose 9% and 7%, respectively. Meanwhile, Jack Dorsey’s Block (NASDAQ:SQ) remained essentially unchanged after seeing significant gains of 6.6% last Friday. Silvergate (NYSE:SI) continued to decline 5.6% after dropping a little more than 45% since its preliminary Q4 financials showed $8.1 billion in withdrawals. Coinbase (NASDAQ:COIN) rose 15% after falling 0.8% last Friday.

All mining stocks’ performance contributed to the growth of Nasdaq, with Greenridge (NASDAQ:GREE) seeing an impressive 38% gain, followed by Bitfarms (NASDAQ:BITF) at +23%. Core Scientific (OTC:COREZQ) and Bit Digital (NASDAQ:BTBT) both saw gains of 22%.

🌐 Top 20 Coins Performance

BTC +0.41% at 17,198; ETH +2.23% at 1,318.

BNB -1.17% at 271; XRP +1.37% at 0.350; DOGE +2.94% at 0.0758.

ADA +4.88% at 0.312; MATIC +0.31% at 0.843; DOT +1.45% at 4.90.

TRX +0.39% at 0.0546; SHIB +1.02% at 0.00000873 LTC +3.40% at 81.30.

SOL +13.49% at 16.42; UNI +4.03% at 5.80; AVAX +0.92% at 12.19.

TONCOIN +2.00% at 2.22; GT +4.60% at 3.35.

Topic of the Day: Ethereum Liquid Staking Protocols See Big Gains as Withdrawal Date Nears

Ethereum’s liquid staking protocols, Lido Finance (LDO) and Rocket Pool (RPL), have seen significant gains in the past 24 hours.

LDO, the governance token for Lido Finance, Ethereum’s largest liquid-staking protocol, saw a 25.4% increase in the past 3 days and trades at around $1.90. This intense trading led to a 436% increase in daily volumes across multiple exchanges, reaching $276 million. LDO is now the 33rd largest cryptocurrency with a market capitalization of slightly over $1.5 billion.

RPL, the native token for Rocket Pool, also saw a 10.3% increase in the past 3 days, trading at around $24.7 and experiencing an 802% increase in daily trading volumes to $7.8 million.

Ethereum itself has seen a 2.2% daily increase and over a 10% weekly increase since switching to a proof-of-stake consensus mechanism in September 2022.

🌐 Ether (ETH) $1,320 (+2.41%) - Bullish Outlook 🐂

ETH Overview:

Closest daily support zone: 1,240 - 1,250
Closest daily resistance zone: 1,313 - 1,372
Key Level: 1,428 (Monthly Close of Jan. 2018)

Ether has risen nearly 10.4% since the beginning of 2023 but is still down by nearly 56.8% YTD. Today it broke above the trendline measured between the close of Apr. 3, 2022, and the close of Nov. 4, 2022, which establishes a breakout.: Chart Link

ETH Daily Resistance zones

1,313 - 1,372
1,428 - 1,450
1,456 - 1,575

ETH Daily Support zones

1,240 - 1,250
1,212 - 1,190
1,150 - 1,125

💸 Lido Finance (LDO) $1,285 (+1.73%) - Bullish Outlook 🐂

LDO Overview:

Closest daily support zone: 1.905 - 1.795
Closest daily resistance zone: 1.982 - 2.125
Key Level: 2.490 (Weekly Low Between Dec. 13 - 20, 2021)

LDO has risen above 100% since the beginning of 2023 but is still down by nearly 46.2% YTD. Like Ether, today LDO formed a bullish breakout pattern.: Chart Link

LDO Daily Resistance zones

1.982 - 2.125
2.157 - 2.318
2.460 - 2.708

LDO Daily Support zones

1.905 - 1.795
1.617 - 1.510
1.440 - 1.322

If you’d like us to cover any specific token or macro data, feel free to reach out to us by dropping a message in our Reddit community.

Notable headlines

🔹 The CFTC and the Justice Department are suing Avraham Eisenberg for alleged manipulation of Mango Markets, a decentralized exchange on the Solana blockchain. Eisenberg is already facing criminal charges for manipulation from the Justice Department.

🔹 Many crypto venture capital firms are reporting that at least half of the companies in their portfolio are delaying token launches due to regulatory and exchange fee issues.

🔹 The U.S. Department of Justice has seized 55 million shares of Robinhood stock owned by FTX co-founders Sam Bankman-Fried and Gary Wang. Former CEO Emergent Fidelity Technologies, which owns over 50 million shares in Robinhood, is 90% owned by Eisenberg.

🔹 Court documents show that 117 parties are interested in purchasing four FTX businesses: LedgerX, Embed, FTX Japan, and FTX Europe. The FTX debtors have entered into confidentiality agreements with 59 of these parties.

🔹 Metropolitan Commercial Bank will be ending its crypto asset services, a week after U.S. regulators warned banks about excessive leverage in crypto. The bank does not hold any crypto on its balance sheet and will be ending relationships with its four institutional crypto clients this year.

🔹 Despite a winter storm, Bitcoin miner Core Scientific increased its production from 1,356 to 1,435 BTC in December. Like other companies, it reduced power usage last month.

🔹 Germany’s financial regulator BaFin has reported that the GodFather malware has attacked 400 crypto and banking apps, stealing login data including two-factor authentication codes.

🔹 The number of Bitcoin ATMs globally has not significantly changed in the past six months, with less than 100 additional ATMs being installed. There are now 38,641 Bitcoin ATMs worldwide, according to Coin ATM Rader, up from 14,051 at the beginning of 2021.

🔹 Huobi Korea is reportedly planning to end its corporate relationship with Huobi Global and operate independently. More than half of Huobi Korea is owned by Leon Lin, the founder of Huobi Global, with the rest being owned by Chairman Jo Guk-Bong and Korea Land Trust.

Author: Peter L., Gate.io Researcher

*This article represents only the views of the researcher and does not constitute any investment suggestions.

*Gate.io reserves all rights to this article. Reposting of the article will be permitted provided Gate.io is referenced. In all cases, legal action will be taken due to copyright infringement.