Proflex Market Update - Wk 47

Dear Subscribers,

Welcome to another weekly review of markets. From Bitcoin’s game theory adoption to AI trade momentum, this week’s newsletter dives into the trends shaping the future of investments.

Market Jitters After Powell’s Comments

Last week, the markets became jittery following Federal Reserve Chair Jerome Powell’s comments signaling a potential slowdown in rate cuts moving forward. While no immediate action was announced, Powell’s remarks hinted that the Fed might be cautious about continuing its rate cut trajectory in coming FOMC meetings, citing inflationary pressures and resilience in economic activity. This uncertainty led to increased volatility across equities and bonds as investors reassessed their positions.

Strengthening Dollar Amid Post-Election Sentiment

The U.S. dollar has been strengthening since the Republicans secured all three branches of government in the recent elections. Markets are now anticipating fiscal tightening measures, with Elon Musk’s DOGE (Department of Government Efficiency) expected to spearhead innovative solutions to reduce trillions in federal spending.

However, infighting within the Republican Party over the critical Treasury Secretary position is adding to the uncertainty. The appointee will play a pivotal role in delivering the promised stability to the dollar and addressing the U.S. debt situation.

Here is a great thread from Ryan Selkis on this topic:

Ryan Selkis (d/acc) 🇺🇸 @twobitidiot Trump's Treasury Secretary and "Team of Rivals" One of the only disappointing points of the Trump transition process so far has been the Game of Thrones that’s emerged for the top economic job in the cabinet: Treasury Secretary. This may be the most important cabinet nomination… https://x.com/i/web/status/1858248993978884306 12:40 PM • Nov 17, 2024 109 Retweets 547 Likes Read 69 replies

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Stronger dollar has also put pressure on precious metals as Gold and Silver took a beating in last few days. But we believe that the strong showing in 2024 in precious metals will continue after the brief pause. We can consider this a healthy correction for now.

Bitcoin at the Center of Attention

Bitcoin continues to dominate headlines, surging past $90k to hit new all-time highs. The rally is not only driven by euphoria but also by mounting speculation that the Trump administration plans to include Bitcoin as part of U.S. reserve assets.

At the state level, proposals for Bitcoin strategic reserves are being voted on, and globally, other nations are accelerating their adoption of Bitcoin into their asset mix.

Meanwhile, corporate America, led by MicroStrategy, is doubling down on Bitcoin as a treasury asset, further solidifying its role as a financial standard. There are new companies like Solidion Technology following on Saylor's footsteps. Meanwhile, Microsoft shareholders have started voting on whether to buy Bitcoin for its corporate treasury.

Game theory is in motion, and the pace of adoption is accelerating. Bitcoin’s climb into six-digit territory may occur sooner than expected, even before the Trump administration officially takes office, as international players move quickly to avoid being left behind.

We’ve long maintained to subscribers that not allocating to Bitcoin is financially irresponsible, and the unfolding events confirm this position. Since launching our crypto fund back in 2018, we’ve forecasted Bitcoin’s ascent to overtake gold—a reality that is now playing out as state and corporate actors race to secure their share of the asset.

Crypto Pulse newsletter has captured the essence of how to best invest in this asset class for our All Access subscribers.

Critical Week Ahead for AI Trade

This week will be pivotal for the AI trade, with Nvidia (NVDA) set to report earnings. Over the past two years, the stock market rally has been heavily reliant on a small group of tech companies driving AI-related CapEx. Hyperscalers have already confirmed rising CapEx levels, affirming that the AI trade is far from slowing. However, delays in Blackwell shipments had paused Nvidia’s meteoric rise, and this earnings report will determine whether there’s more upside in the sector or if a correction is needed to align with reality.

For Proflex All Access subscribers, we will be providing real-time updates on Nvidia’s earnings and its implications for the AI trade. Stay tuned for our detailed commentary later this week.

Proflex All-Access Performance Hits New Highs

Proflex Growth Gazette, the flagship portfolio in All-Access, has performed exceptionally well, achieving more than 2x of S&P500 returns in consecutive years. And Proflex Crypto Pulse is having second year with triple digit returns.

This success underscores the importance of our growth-focused strategies and proactive risk management during both bullish and uncertain market periods.

Proflex All-Access: Your Market Compass

Explore the financial markets with Proflex All-Access, your comprehensive resource for deeper market understanding and active participation. This premium service offers subscribers exclusive insights and actionable investment advice, giving you a significant edge in various market conditions.

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Proflex All-Access provides detailed analyses and recommendations to optimize your investment strategy. Our specialized newsletters include:

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• Growth Gazette: Aimed at achieving above-market returns for aggressive portfolio growth.

• Income Insider: Focused on conservative strategies and income generation for yield-seeking investors.

• Crypto Pulse: Offers advanced strategies for investing in the rapidly expanding cryptocurrency market.

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Feel free to send us your queries at proflex@blockstart.one

Best regards,

Raman Bindlish

Editor-in-Chief,

Blockstart Research

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