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Market Picture

The cryptocurrency market has been rising since the start of the day on Thursday, recovering strongly from Wednesday’s late afternoon sell-off in the wake of global financial markets. At its lowest point, the market capitalisation was down to $2.23 trillion, and at the time of writing, it had risen to $2.32 trillion (+0.1% in 24 hours). The market’s intraday movements will reveal whether this marks the bears’ last stand or if the current rebound is just a bull trap.

Bitcoin’s intraday dynamics are bullish. Wednesday’s end-of-day lows saw a flash drop below $65.5K, completing a 61.8% Fibonacci retracement of the 10-21 October rally. A quick exit to the recent highs at $69.5K would make the main scenario an extension of the upside with the potential to strengthen to $76K before further consolidation.

News Background

According to CryptoQuant, 94% of the Bitcoin supply is ‘long’, with the median purchase price hovering around $55K. Such high levels of unrealised profits have historically served as a precursor to significant BTC corrections.

Retail demand for Bitcoin returned to pre-ATH levels in March. This contrasts with the first quarter when large players largely drove demand.

Bernstein reiterated its prediction of a $200K price for the first cryptocurrency by the end of next year, calling it ‘conservative’. BTC’s investment appeal is increasing against the backdrop of rising US government debt and the threat of inflation.

Macro:

Equities: 

The eurozone PMI has been on the decline since June, causing doubts about an already frail economic recovery from the energy crisis. So much so that the European Central Bank has decided to pick up the pace in terms of rate cuts. Listening to ECB President Christine Lagarde at the latest press conference, she seemed to put a lot of weight on the deterioration of survey data in explaining the decision to cut rates in October.

That makes the release all the more relevant for markets, which are increasingly pricing a 50bp cut for December. At the IMF meetings in Washington, hawks have been pushing back against a 50bp cut if economic circumstances do not deteriorate much further. This mostly indicates that the pace of cuts remains very much open ahead of following meetings.

The PMI was slightly up thanks to an easing contraction in manufacturing, hardly something to cheer about since the manufacturing sector has been in contraction since late 2022. The services sector continues to drive economic growth for now, but the survey did note a further weakening of new orders for the sector.

This means that the outlook for the economy remains sluggish at best for the foreseeable future, with businesses responding by reducing headcount according to the survey. The weakening economy and sluggish incoming demand also means that the inflation environment remains benign according to the survey.

At the same time, hard data on July and August has not been all too bad, which means that GDP growth in the third quarter could surprise on the upside. With survey data continuing to come in weak though, this may prove to be a dead cat bounce. For the ECB, the debate about how fast to move to neutral will no doubt be heated ahead of the December meeting.

The price of natural gas price in Alberta is set to lose its discount once the LNG Canada project enters into operation, the chief executive of Tourmaline Energy, the country’s top natural gas producer, has warned.

LNG Canada, a project led by Shell, is going to need some 1.9 billion cu ft of natural gas in daily supply, Tourmaline Energy’s Michael Rose told Bloomberg in an interview this week. Currently, this amount is being exported to the United States and is depressing local prices. Once it gets diverted to LNG Canada, prices are set to move higher.

LNG Canada is the country’s first project for the export of the superchilled fuel, with the focus on Asian markets as the biggest demand drivers. Eventually, however, Canada could potentially supply 36.2 million tons of LNG per year by 2040, according to estimates by Wood Mackenzie. LNG Canada is scheduled to begin operations next year.

This projected growth in LNG capacity in Canada will further boost demand for natural gas in the country, leading to higher prices. Last year, in anticipation of these price trends, Tourmaline acquired another gas producer, Crew Energy, eyeing an even bigger footprint in the segment.

“Generally, the right time (for deals) is at the bottom of cycles, and we think we are near, or at, or past the bottom in the natural gas pricing cycle,” Michael Rose told the Calgary Herald in an interview after the news of the acquisition broke.

“The future looks bright for Canadian and North American gas with the doubling of the LNG capacity in the U.S. and the startup of Canadian LNG on the West Coast,” Rose added.

It is worth noting that Canada’s energy industry is pursuing its LNG ambitions despite an anti-LNG stance by the federal government, which recently dashed hopes by the German cabinet about securing a steady supply of Canadian gas for the future in liquefied form.

Source: OILPRICE

More internships and use of technology can bridge the gap between what people are trained for and what is in demand in the market, said Singapore President Tharman Shanmugaratnam.

“The massive mismatch of skills. It’s not just a developing country problem. It’s a problem in the United States, in the UK, everywhere,” said President Tharman in a fireside chat, held after the inaugural meeting of the High-level Advisory Council on Jobs on Oct 24 (Singapore time) at the World Bank building in Washington DC.

However, President Tharman, who is co-chair of the Council with former Chilean president Michelle Bachelet, said the skills mismatch is a problem that can be fixed with the right policy initiatives.

“We have to close the gap between employers and educational institutions. By increasing internships, increasing what’s called the dual education mode, where people study and work at the same time.”

He said technology can also help in getting a lot more granular information on what employers need and then feeding it into training institutions’ curriculum.

“Essentially, we need fairly wholesale reform in tertiary education and in skills development systems around the world to tackle this mismatch of skills.”

The need to reform pre-university and university curriculum and upgrading workforce skills was recognised by Singapore a while ago.

Singapore has been taking steps to create a more variegated tertiary education landscape across its colleges, universities, and polytechnics in the past several years. Additionally, the Republic has launched several initiatives to strengthen the relevance of skills training for the existing workforce.

The High-level Advisory Council on Jobs, announced in August 2024, is a World Bank initiative aimed at identifying actionable policies and programs to address the looming jobs crisis in the developing world.

The Council’s first meeting and the fireside chat were part of the nearly weeklong annual meetings of the International Monetary Fund and the World Bank to be concluded on Oct 26 in the US capital.

The World Bank estimates that over the next 10 years, an unprecedented 1.2 billion young people in the developing world will become working age adults. Meanwhile, the job market is only expected to create 420 million jobs - leaving nearly 800 million without a clear path to prosperity.

President Tharman said that job creation is one of three defining challenges of our time, and creating more jobs is the only way to ensure success in dealing with the other two challenges - tackling climate change and preserving an open rules-based international order, needed to keep trade, investment and data flowing, and to keep the peace.

“We have to give urgency to job creation,” he said. “If we don’t do that, it’s going to be very hard to sustain domestic support anywhere (for measures to tackle) climate change. It’s going to be very hard to sustain support anywhere for an open world order.”

However, the President stressed that success in job creation is not about reaching an end state.

“Success is a process. Success is about getting onto learning curves – enabling workers and firms, and clusters of firms within an industry, to learn by doing; skills begetting skills, and moving up the value chain over time.

“Success is about rising aspirations, and about changing the political economy of a country so that policy makers are rewarded for reform and for keeping an economy inserted in the global economy, rather than closing in on themselves,” he said.

Source: Straitstimes