Bitcoin, Euro Surge Against Dollar

CRYPTO
Bitcoin, Euro Surge Against Dollar

In a surprising shift, options tied to Bitcoin (BTC) and the euro-dollar (EUR/USD) exchange rate are showing strength against the U.S. dollar, even as the U.S. stock market struggles. This suggests the "sell America" trade is gaining momentum. Bitcoin’s short-term risk reversals, which gauge demand for call options versus put options, are slightly positive, signaling a bullish outlook. Data from Deribit and Amberdata reveals a recovery from the previous trend favoring puts in near-term options.

Simultaneously, the one-month EUR/USD risk reversal has also flipped positive, indicating a favorable outlook for EUR call options, according to Jens Nordvig of Exante Data Inc. This shift suggests capital is moving away from U.S. assets, which have recently underperformed, and into Bitcoin, the euro, and commodities like gold.

On Monday, Bitcoin surged past $88,000, the euro hit a high of 1.1575, and gold reached a record price of $3,495 per ounce.

FINANCE
U.S. Stocks Fall Amid Concerns

U.S. stock indexes fell on Monday, marking a rough start to the week amid growing concerns over President Donald Trump’s trade war and the future independence of the U.S. Federal Reserve. The "Sell America" trade remained in full effect as all major indexes closed lower. The Dow Jones dropped 2.48%, the S&P 500 fell 2.36%, and the Nasdaq Composite lost 2.55%. Meanwhile, the dollar slid to a three-year low, and Treasury bond yields rose, with gold reaching record highs.

Investor fears were compounded by Trump's attacks on Fed Chair Jerome Powell, calling him "Mr. Too Late" and urging rate cuts despite ongoing inflation. Critics worry Trump may attempt to remove Powell, which could lead to greater market instability.

The dollar’s decline, alongside rising yields and soaring crypto and gold prices, indicated growing global distrust in U.S. assets. Meanwhile, Trump’s tariffs and trade uncertainty are raising recession concerns, with economists predicting a 90% chance of a U.S. recession in 2025.

TECH
Google Faces Antitrust Breakup Threat

Google is facing a critical moment as the U.S. government pushes to break up the company for turning its search engine into an illegal monopoly. The case, which began Monday in Washington, is a result of a landmark Justice Department lawsuit filed four-and-a-half years ago, accusing Google of stifling competition through anti-competitive deals. The government is calling for radical remedies, including banning exclusive deals with tech companies like Apple, forcing Google to share user data with competitors, and even selling its popular Chrome browser.

Google’s attorney argues the company won its market position fairly and that the proposed measures would harm competition. The case also highlights concerns about Google’s future use of AI, as the Justice Department fears it may use AI products like Gemini to further its monopoly. The case, supported by both the Biden and Trump administrations, is set to determine Google’s penalties and could have wide-reaching implications for the tech industry.

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.