This morning we received good news about the second covid vaccine candidate, this one from Moderna. This initial reaction to the news seems to be a somewhat smaller version of exactly what we saw last Monday, with cyclicals outperforming and tech selling off. This time, however, gold and BTC are holding firm.

Watching BTC charts, we are beginning to see a bit of a weekly pattern, with weakness coming on the weekends. There could be several reasons for this, and I think it is likely that they all have at least some contribution. First and foremost, even though BTC is a 24/7 market, the rest of the financial world is not. The support that we have seen from institutional money entering the product likely tapers off significantly over the weekend. Add to that the reduced liquidity, making it easier for sellers to try to force liquidations from the massive leverage cowboys on the foreign unregulated exchanges, that still allow insane leverage. It is also harder for these same levered retail traders to make margin calls, as wire transfers of fiat take longer to settle. Yet as soon as the rest of the world comes back to work Monday morning, and the CME and ICE futures open for trading, prices have rebounded easily.

We’ll see today if the covid unwind rotation continues, but I anticipate that it will be a smaller factor on the second vaccine announcement than it was on the Pfizer announcement last Monday. In any event, the BTC rally off of the weekend dip continues to support the thesis of institutional money defining the current trend in prices in crypto.

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