SignalPlus Macro Analysis (20240606): BTC ETF inflow exceeds 1.2 billion USD in two days

ADP employment data (152,000 vs 175,000) and the weak employment component of the US services PMI continue to dampen market risk appetite. Respondents in the survey pointed out that "we are adjusting our hiring and capital investment strategies and managing borrowing," "feeling the economic slowdown," "recruitment is decreasing, and prices are slightly rising," and "high interest rates are reducing capital investment and slowing upgrades of major facilities," leading to the market overlooking the strongest overall performance of the non-manufacturing ISM index in 9 months (53.8 vs 51).

The Bank of Canada’s 25 basis point rate cut is seen as the beginning of an upcoming easing cycle, with federal funds futures pricing indicating two full rate cuts by the end of the year, and the likelihood of a rate cut in September has also risen to over 60%. As expectations for a Federal Reserve rate cut fully return, the 10-year US Treasury yield is currently below 4.30%, the 2/10s curve has inverted again, and the spread has returned to a recent low of -45 basis points.

With yields falling, the Nasdaq index rose again by 2% yesterday, and the SPX index increased by 1.1%, once again approaching historical highs. Due to a series of weak employment indicators over the past two weeks, the market expects Friday's non-farm payroll data to also be weak, while ETF investors have injected $58 billion into the US stock market this month, with inflows reaching $315 billion year-to-date, completely disproving the traditional stock market adage "Sell in May And Go Away."

Moreover, incredibly, Nvidia's dominance in the market continues to expand, with its trading volume on that day nearly equivalent to the combined total of the next 9 stocks.

Finally, the stock market is also preparing to enter a friendly first half of July, a period that has been the most seasonally positive for the stock market over the past two weeks, with data dating back to 1928. The cryptocurrency sector is no exception, with ETF inflows continuing to accelerate; following an inflow of $886 million on Tuesday, another $333 million was added yesterday. Will prices reach more historical highs? Are there any shorts still alive? Friends, enjoy while you can!