Boy Lost In Thoughts

The coming week presents a concentrated dose of market risks and pivotal data. Central drama swirls around the Federal Reserve, where the nomination of Kevin Warsh as the next Chair introduces policy uncertainty, coinciding with a historic crash in gold prices that threatens to ripple through related assets.
The focal point will be the U.S. labor market, with January's nonfarm payrolls expected to show significant weakness, potentially stalling due to sector-specific issues and broader economic headwinds. This contrasts with Canada's surprisingly robust job market.
Globally, central banks are in the spotlight. The Reserve Bank of Australia is positioned as a potential early adopter of tightening, while the European Central Bank and Bank of England are expected to remain on hold. Investor uncertainty is further compounded by a risk to Tether's stablecoin peg, a potential U.S. government shutdown, and a continuing stream of corporate earnings reports.
Key Points:
Federal Reserve Uncertainty: Kevin Warsh's nomination as the next Fed Chair creates market uncertainty. His potential dovish rate bias clashes with a hawkish stance on the balance sheet, causing confusion and curve steepening.Gold Meltdown Spills Over: A massive, sudden drop in gold prices threatens knock-on effects across miners, cryptocurrencies, and leveraged finance.Stablecoin Peg at Risk: Tether's dollar peg is under pressure, raising concerns about broader crypto market stability given its massive growth and significant gold reserves.Critical U.S. Jobs Report: January's nonfarm payrolls are forecast to be weak (around zero change), with risks skewed downward due to expiring healthcare subsidies, falling job postings, and weather/ICE detention effects.Central Bank Watch: The RBA may become the first major central bank to hike rates, while the ECB and BoE are expected to hold in a state of "unblissful stasis." The RBI is likely to hold due to inflation and currency concerns.U.S. Shutdown Risk: A short government shutdown is possible, with a low risk of delaying the crucial payrolls data.Canada's Hot Job Market: Contrasting sharply with the U.S., Canada's labor market is strong, with soaring job postings and significant gains since last summer.Earnings & Data Onslaught: A busy week for corporate earnings (Amazon, Alphabet, etc.) and global macro data (ISM reports, global CPI prints) adds to the market risk.
$SOL

In early February, three major central banks will make policy decisions, revealing divergent paths amid global economic uncertainty.
Reserve Bank of Australia (RBA): Expected to raise rates by 25 basis points to 3.85%. This hawkish stance is driven by persistent inflation, a tightening labour market (unemployment at a 7-month low of 4.1%), and accelerating consumer prices. The RBA has been notably less aggressive in cutting rates compared to global peers, and recent communications have shifted firmly away from discussing further cuts.Bank of England (BoE): Expected to hold rates at 3.75%. The focus will be on the meeting minutes and voting split. Key to watch will be Governor Bailey’s language on inflation persistence and whether committee members like Sarah Breeden shift from voting for cuts to holding. A change could strengthen the hold vote (e.g., to 6-3), prompting markets to further scale back expectations for near-term rate cuts.European Central Bank (ECB): Also expected to hold rates, maintaining that policy is “in the right place” with inflation on target. However, new geopolitical risks from events in Greenland and U.S. trade threats are raising concerns. The critical insight will come from President Lagarde’s press conference, gauging the ECB’s worry over these threats to both trade and Europe’s political stability, even as the region makes long-term progress on trade diversification.
Bottom Line: While the RBA is poised for a hike and the BoE and ECB to hold, the subtleties in each bank's communication will be critical for understanding their tolerance for inflation and their sensitivity to emerging geopolitical risks in 2026.
$XRP

In a bold and unexpected move, Colombia’s central bank hiked its benchmark interest rate by a full percentage point to 10.25%—significantly exceeding market forecasts and putting it at odds with the government’s push for lower rates. The decision underscores the bank’s aggressive pivot toward fighting inflation, despite concerns about economic growth and political opposition.
Key Points:
Surprise 100 bps hike → Interest rate raised to 10.25%, far above the 50 bps increase most analysts expected.Inflation-driven decision → Core inflation rose in December, and the bank sharply revised its 2025 inflation forecast up to 6.3% from 4.1%.Minimum wage increase adds pressure → President Petro’s 22.7% minimum wage hike is seen as likely to fuel price rises.Widening economic risks → Current account deficit projected to grow, 2025 growth forecast trimmed to 2.6%, and external uncertainties noted.Deep internal division → Board split 4–2–1 (100 bps hike vs. 50 bps cut vs. hold).Open clash with government → Finance Minister publicly opposed the hike, reflecting President Petro’s preference for rate cuts to spur growth.
$BNB

Markets witnessed dramatic swings in commodities last week—from gold’s record high and sudden plunge to wild moves in silver and natural gas. Attention then pivoted to Washington, where Kevin Warsh was selected as the next Federal Reserve Chair. While expected, Warsh’s past skepticism of quantitative easing could shape a new policy trade-off: faster balance sheet reduction for lower short-term rates.
Beneath the surface, the U.S. economy shows cracks—sluggish hiring and sinking consumer confidence—even as GDP stays firm. In Canada, growth is stalling, keeping the Bank of Canada sidelined amid soft job markets and simmering trade risks. Those risks escalated as President Trump threatened massive tariffs on Canadian exports, while Canada’s trade deficit widens beneath the temporary boost from gold.
Amid the noise, one thing is clear: from Fed policy to trade tensions, the real story is just beginning to unfold.
Key Points:
Commodity Rollercoaster: Gold surged past $5,500/oz before a sharp 14% reversal, while silver and natural gas saw extreme volatility. Crude oil jumped 5% amid Iran tensions.Fed Leadership Shift: Kevin Warsh was chosen by President Trump as the next Fed Chair—widely expected, but his history of criticizing QE suggests he may push for balance sheet reduction in exchange for lower short-term rates.Bond & Currency Reaction: Treasury yields saw minor shifts; the U.S. dollar briefly strengthened but ended the week lower overall. Precious metals slumped, with silver dropping 30% in a day.U.S. Economic Paradox: Surface-level GDP growth contrasts with weak hiring, falling consumer confidence, and persistent inflation—pointing to underlying economic stress.Canadian Slowdown: Flat output in November and minimal growth in December raise recession risks. The Bank of Canada is on hold, with rate cuts far more likely than hikes.Trade Tensions Escalate: President Trump threatened extreme tariffs on Canadian goods if Canada aligns with China, amid a widening Canadian trade deficit that’s masked by volatile gold exports.TSX Pullback: After record highs, Canada’s stock index fell 3%, reflecting gold’s reversal and rising trade uncertainty.
$BTC

The U.S. government has entered a partial shutdown following a congressional deadlock over funding the Department of Homeland Security. Triggered by a deadly encounter involving Border Patrol agents, Democrats are withholding DHS funds until new oversight measures—including body cameras and judicial warrants for agents—are adopted. While essential services and pre-funded departments continue operating, affected agencies have initiated shutdown protocols. A stopgap agreement, already passed by the Senate, awaits a House vote Monday and is expected to quickly end the disruption. The clash highlights growing political tensions over immigration enforcement ahead of the midterm elections.
Key Points:
A partial U.S. government shutdown began Saturday due to a congressional stalemate over Department of Homeland Security (DHS) funding.The standoff was triggered by a fatal confrontation involving Border Patrol agents in Minneapolis, leading Democrats to demand new restrictions on immigration enforcement before approving DHS funds.This is the second funding lapse since Trump returned to office, though it’s expected to be short-lived, with a House vote planned for Monday.Several departments (e.g., Agriculture, Veterans' Affairs, National Parks) remain unaffected, while others (Homeland Security, Treasury, Defense, etc.) have begun formal shutdown procedures.A temporary deal between Trump and Democratic leaders funds DHS for two weeks while fully financing other agencies through September, pending House approval.The political clash comes as Trump’s deportation policies face declining public support, posing potential risks for Republicans in upcoming elections.
$A2Z

A ruling by Panama’s top court against a Chinese-backed port operator has escalated U.S.–China tensions over the strategic Panama Canal. The decision invalidates CK Hutchison’s long-held concessions to run key canal ports and aligns with the Trump administration’s push to curb Beijing’s regional influence. China has pledged to defend its companies’ interests, while the move raises uncertainty over a multibillion-dollar global port deal and underscores the waterway’s role in the geopolitical rivalry.
Key Points:
Panama’s Supreme Court has ruled unconstitutional a port concession held by Hong Kong–based CK Hutchison at both ends of the Panama Canal.The decision is viewed as a win for the Trump administration’s efforts to counter China’s influence in the Western Hemisphere.CK Hutchison’s shares fell nearly 5% following the ruling, and a planned $23 billion global port sale is now in question.China’s foreign ministry vowed to take “all necessary measures” to protect Chinese companies’ interests.President Trump has previously emphasized U.S. strategic dominance in the region, calling the canal “vital to our country” and alleging Chinese operational control.
$ETH

President Donald Trump's nomination of former Fed Governor Kevin Warsh to lead the Federal Reserve has left the massive Treasury bond market cautiously relieved yet apprehensive. While traders believe the choice dodges more radical alternatives, market movements reveal underlying fears that a Warsh-led Fed might cut interest rates more aggressively than planned, potentially fueling future inflation. Warsh’s past advocacy for lower rates and a reduced central bank balance sheet aligns him closer to Trump’s preferences, setting the stage for potential policy shifts. However, experts note his views may evolve, and his success will depend on convincing a potentially skeptical committee, with the possibility of pushing through extra rate cuts by year-end.
Key Points:
Not the Worst, But Not Perfect: Traders see Trump's nomination of Kevin Warsh for Fed Chair as avoiding a "worst-case" scenario, but are uneasy about the future direction of interest rates.Market Anxiety Shows in Yields: The bond market's reaction—higher long-term yields and a steeper curve—signals concern that Warsh may push for more aggressive rate cuts than currently expected, risking longer-term inflation.Inflation Fears Linger: Key market measures show growing anxiety about sustained upside risks to inflation.Policy Pivot Potential: Warsh has a history of advocating for a smaller Fed balance sheet and has recently favored lower rates, aligning more closely with Trump's criticism of current Fed policy.Chairman's Challenge: As Fed Chair, Warsh would face the challenge of building consensus within a committee that may not share his views, though economists speculate he could engineer more rate cuts than the Fed's current plan.
$AXS

XRP experienced a severe downturn, breaking below the key $1.75 threshold after two days of heavy selling. This drop was fueled by a combination of disappointing U.S. inflation figures and market anxiety over potential Federal Reserve policy under Trump's nominee, Kevin Warsh. While the short-term technical outlook has turned negative with a risk of falling to $1.50, analysts maintain a cautiously bullish medium-term forecast targeting $2.50. This optimism hinges on anticipated Federal Reserve rate cuts and advancements in U.S. cryptocurrency regulation. The price action now hinges on ETF flows, central bank signals, and political developments surrounding crypto legislation.
Key Points ):
Sharp Sell-Off: XRP crashed over 4% to break below the critical $1.75 support level, confirming a bearish short-term trend reversal.Dual Catalysts: The plunge was triggered by 1) Hot U.S. producer inflation data (cooling Fed rate cut hopes) and 2) Policy uncertainty from President Trump's nomination of Kevin Warsh (seen as crypto-skeptical) for Fed Chair.Risks & Targets: Immediate support sits at $1.50, but medium-term (4-8 week) targets remain $2.50, supported by expected Fed cuts and crypto regulatory progress.Key Risk Factors: A hawkish Bank of Japan, delayed U.S. crypto legislation ("Market Structure Bill"), or sustained ETF outflows could intensify selling pressure.Broader Context: XRP and Ethereum fell significantly harder than Bitcoin, possibly reflecting market concerns over Warsh's historically negative views on non-Bitcoin cryptocurrencies.
$XRP

The iShares Bitcoin Trust (IBIT) has broken down from a bear flag pattern, signaling a resumption of its downtrend. After falling below the key level of $49.40, the ETF hit a new low of $46.37—its weakest price since early April 2025. The breakdown was confirmed by strong volume and a failed rally below the 50-week moving average.
Key Points:
Bear flag breakdown confirms renewed selling momentum.Price fell below $49.40, triggering continuation of the downtrend.New 10-month low hit at $46.37.Fibonacci support zone identified between $44 and $41.Any rebound is expected to face selling pressure near former support around $49.32.Bearish outlook remains unless IBIT sustains a move above $51.31.
Bottom Line:
Technical structure points to further downside, with targets near $44–$41. Rallies are likely to be sold until key resistance is broken.
$BTC

Key Points :
Silver crashed in an extreme, multi-sigma move – volatility hit historic levels, with 1-week implied vol reaching ~100%, a classic warning sign of a major turning point.The week’s theme: “Hedge America” – Foreign investors, especially European pension funds, rushed to hedge U.S. asset exposure over fears of regulatory, tax, or confiscation risks under growing U.S. state capitalism and extraterritorial policies.Fed Chair suspense ends with a “vanilla” pick – Kevin Warsh’s nomination suggests continuity, not change, at the Fed. This mildly supports the USD and pressures precious metals, prompting a expected consolidation phase.Market positioning stretched – Retail investors are “full to the gills,” speculative assets like silver and “football” stocks are sagging, and February seasonally looks shaky for equities and metals.Dollar selling exhausted for now – Aggressive USD hedging by funds peaked around month-end; a short-term consolidation is likely as the Warsh news gets digested.Bitcoin loses its last bullish narrative – With gold and silver collapsing, Bitcoin’ next key support around $74K–75K looks vulnerable.Commodities and currencies linked – AUD moved almost tick-for-tick with silver during the selloff, showing how intertwined metals and commodity currencies have become.The big picture: Extreme moves are normal in finance – “Tail events” happen frequently; markets aren’t normally distributed, so historic volatility spikes should be expected, not seen as “impossible.”
$SENT

A new forecast for 2026 reveals a clear shift in the engines of the global economy, with emerging markets—particularly in Asia—taking the lead.
According to IMF data visualized by Voronoi, global real GDP is projected to grow by a resilient 3.1% in 2026. The standout story is the overwhelming contribution of the Asia-Pacific region, which is expected to account for nearly 60% of all global growth.
China and India are the dominant forces, together responsible for 43.6% of the world's economic expansion. Despite a moderated growth rate, China's massive economy alone contributes 26.6%, while India's rapid 6.2% growth accounts for 17%.
In contrast, advanced economies are playing a smaller role. The United States remains the largest developed-nation contributor at 9.9%, but combined contributions from the U.S. and Europe total just 16%, highlighting the eastward shift in economic momentum.
Other key emerging economies rounding out the top contributors include Indonesia, Türkiye, Saudi Arabia, Egypt, and Vietnam. Africa, home to several of the world's fastest-growing economies, is projected to contribute 7.7% to global growth.
The forecast underscores a new global growth landscape, where population growth, expanding workforces, and rising consumption in developing nations are powering the world economy.
$DUSK

We have revised our central bank forecasts, delaying the expected start of Fed rate cuts to June due to resilient U.S. growth. Meanwhile, we anticipate the European Central Bank will stay on hold throughout 2024, benefiting from a stable economic "good place." In contrast, the Bank of England is still projected to cut rates in March and June as inflation recedes, while a stronger outlook prompts us to move forward our call for the Bank of Japan’s next rate hike to this summer.
Key Points:
Fed: Rate cut timeline pushed back — now forecasting first cut in June (vs. prior March call). Reason: solid growth & strong equity markets outweigh concerns on jobs momentum. Expect only two cuts in 2026.ECB: Expected to keep rates on hold all year. The bank is in a "good place" with growth near potential and inflation near target, despite high geopolitical uncertainty.BoE: Still forecasting cuts in March and June, despite the Bank’s current caution. Weak hiring, slowing wage growth, and falling inflation should provide enough confidence by spring.BoJ: Next rate hike brought forward to June (from October). Driven by stronger wage growth outlook, planned fiscal stimulus, and firm price adjustments. An April move is seen as less likely.
$VANRY

Key Points :
Current Stance: Voted to hold interest rates steady (3.5% - 3.75%), viewing policy as "moderately restrictive."Top Concern: A Fragile Labor Market. This is the greater risk than inflation.Job growth has slowed significantly and is concentrated in few sectors (like healthcare).Unemployment, while recently sideways, has risen over the past year.Forward-looking indicators (e.g., job availability) suggest weakness could continue.Warns the labor market can seem stable "right up until it isn't."Inflation Outlook: Progress, But Noisy Data.Believes the underlying inflation trend is already near the 2% target when temporary tariff effects are excluded.Recent volatility in inflation data is influenced by statistical noise and one-off category spikes.Rationale for Patience: After cutting rates by 0.75% last year, prefers to "keep policy powder dry" temporarily.Wants to assess how past cuts are affecting the economy.Acknowledges recent data is clouded by measurement issues from the government shutdown.Sees merit in waiting for more data (two more inflation/jobs reports) before the March meeting.Future Policy Path: Baseline includes three rate cuts in 2026, but timing is the debate.Ready to act if labor market shows "sudden and significant deterioration."Will not overreact to potentially noisy Q1 data, especially on inflation.Stresses policy is not on a preset course and will be data-dependent.Warns against signaling that rates will stay high for "an extended period," as it ignores labor market risks.Economic Baseline: Expects solid growth, boosted by AI investment, productivity gains, and favorable supply-side policies (regulation, taxes).
$XPL