Geopolitics and Markets Review 22nd July 2022:

I’m going to start with cryptocurrencies, and we’ve seen a rise in the major players over the last month. Bitcoin hit a 52-week low of around $18000 and now finds itself above $23000. @RaoulGMI posted an interesting tweet about how crypto could be linked to M2 YoY deviation from the overall trend, indicating that the crypto market does better when there is greater liquidity available in macro. As M2 leaves its mean reversion trend, the crypto total market cap follows suit. I am incredibly interested in the correlation here, and if it could be used in the future to forecast crypto market direction.

$SPX is incredibly close to $4000, and 56% of stocks in the $SPX are back above their 50-day moving average. Although the market looks bullish from here, and I think sentiment has improved, as shown in the fear and greed index by CNN, I don’t think the entire macro environment has changed that much. Inflation is still high and rising, recessions due to reduced growth from rising rates, and protests are still happening around the world. I was in Budapest last week, and there were protests over tax rises on small businesses committed to by the Hungarian government. There are still a lot of negative subjects influencing the financial markets, but I can see flashes of positivity, and a lot more than a few months ago.