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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
FOREX
- Despite the constant flow of global macro and geopolitical news, the recent carnage in the cryptocurrency market stole the 'show' in the past two weeks with Bitcoin experiencing a 50-percent drawdown from peak to trough.
- It is interesting to see that some media news and market participants have been surprised by the plunge in the crypo market; however, it is important to recall that the recent consolidation comes after a fifteen-fold rise in the price (from its low reached in March 2020 to its record high of 64,870 in mid-March).
- We know that one fundamental rule in finance is 'Easy gains come with easy losses'; there has never been an asset in history of finance that has continuously trended higher without ever experiencing a moderate to significant drawdown.
- This chart (Bitcoin in log term) shows that periods of significant appreciation in Bitcoin prices have generally been followed by short periods of sharp consolidation.
- For instance, Bitcoin experienced three significant drawdowns (of 35%, 40% and 26%, respectively) during the 2017 rally, and then was eventually followed by a LT retracement of 84% in 2018.
- 2021: is it just a short-term retracement or the start of a LT bear consolidation?
Source: Bloomberg/MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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