Bitcoin could reach $100k
By Yann Quelenn
Who would have thought at the start of 2017 that Bitcoin would increase 20-fold? That was simply unpredictable. The introduction of futures trading has driven up prices. Nonetheless, it is also artificially increasing supply and weighing on prices. In the short-run, Bitcoin is likely to reach US$ 25,000. A correction is due at some point, but within the next few years it should easily reach US$ 100,000.
By the way: Bitcoin is far from perfect, with high transaction fees and low scalability. And it is expensive, but it is even more scarce.
US Tax and the yen
By Peter Rosenstreich
USD/JPY’s high sensitivity to yields has failed to respond, holding the pair at 112.60. With the Bank of Japan focused on Yield Curve Control and politics mixed, speculation of a change of policy is premature – this will keep USD/JPY from surging higher.
Until Catalonian elections on Friday, the markets this week will focus on US tax reform. Despite the hype over benefits into the US economy and support of the USD, we suspect real impact will be limited. President Trump has called it a great Christmas gifts to middle-income people, but we think it’s hardly that great – plus we’ll have to wait to do our tax returns on a postcard. US rates are also unimpressed as the 10-yr treasury lingers around 2.36%. The markets fell for the “Trump Growth” story in 2017, but in 2018 they might not.