Overview
Raoul Pal studies bear market bottoms.
Bitcoin continues to lack volatility.
Uniswap to deploy on zkSync.
Magic Eden: the latest NFT marketplace to go feeless.
Good morning Fam,
The big question on everyone’s mind: when will the bear market bottom? Soon? Next year?
We’re not really too sure, but one of the most prominent names in finance did a study that may peak your interest. Let’s explore.
According to Raoul Pal in his latest Tweet, history has shown that October is the month markets tend to crash, BUT it's also the month that "kills bear markets."
In the Tweet, Pal shared five instances where the market bottomed in or near October:
1987 saw one of the largest market collapses in history, and prices bottomed on Oct 18th.
Source: Twitter, Raoul Pal
In 1929, the market crashed in October, and stocks bottomed in November. Then, the US entered the Great Depression until 1932.
Source: Twitter, Raoul Pal
In 1974 the inflation-induced bear market bottomed in October.
Source: Twitter, Raoul Pal
"1997 - The Asian crisis hit all world markets, and the Fed had to pivot. Another October crash and generational low." Raoul Pal.
Source: Twitter, Raoul Pal
In 1998, Russia defaulted, which caused the "fastest collapse in history," with a generational low in October.
Source: Twitter, Raoul Pal
Raoul Pal's stance on this year's bear market: "This one has been the largest destruction of wealth in history in dollar terms and the second largest in GDP terms (2008 was worse)." And this year's chart is set up very similar to years past.
Source: Twitter, Raoul Pal
History tends to rhyme. So will this trend continue?
Market update 🌍
BTC/USDT 1W
BTC entered its third week of low volatility, raising some fears of the bottom falling out. On the other hand, the bulls have preserved the $19k support level for 17 straight weeks. Some altcoins such as Quant (QNT), Frax (FXS) and Arweave (AR) took the quiet weekend as an opportunity to climb. BTC completed the weekly candle down -0.91% to $19,262.
High-resolution chart
Newswatch 📰
Uniswap to deploy on zkSync. Nearly 100% of the Uniswap community voted to deploy the most popular Decentralized Exchange (DEX) on the privacy-focused zkSync that utilizes an Ethereum scaling solution called ZK Rollups. The development comes after zkSync announced its plan to go to mainnet after being in testnet since February. ZK Rollup technology allows for increased scalability, cheaper transactions, and faster speeds. Uniswap plans to go live on the network in four to six weeks.
Wintermute pays off $96m crypto loan despite hack. Crypto market-maker Wintermute paid off its $96m loan on crypto platform TrueFi three weeks after being hacked for $160m. The USDT uncollateralized loan was due to mature on Oct 15th.
News Tidbits:
China delays the release of its third quarter GDP, without giving a reason or a new date.
North Korean hacker group Lazarus targets crypto firms in Japan.
Justin Sun admits to owning “tens of millions” Huobi Tokens.
Deep dive into Aave’s stablecoin GHO.
China urges citizens to leave Ukraine and surrounding areas immediately.
NFT & metaverse update 🐵
Solana-based NFT marketplace Magic Eden transitions to an optional royalty model by eliminating its 2% platform fee.
My Five Cents…
It's a big week in the traditional markets. Some significant events unfolding this week include:
Major Earnings (Tesla, IBM, Netflix, Amazon, Goldman Sachs, Bank of America).
Existing Home Sales, Thursday 10 am EST.
Monthly OCT options expiration. Friday premarket.
Fed Speakers Wednesday, Thursday, and Friday.
Market conditions will remain tough this week as macro continues to raise uncertainty. Not to mention, many pundits are predicting a tough earnings season. And with China urging its citizens to leave Ukraine and its surrounding areas immediately, concerns have been raised of potentially increased aggression by Russia in the war.
Stay vigilant and prepare for anything, in case Raoul Pal’s historical study is correct and October marks the bottom.
Gabriel M.
Follow me on Twitter for daily updates!