Bitcoin: Greed is the main driver at the moment.
Sheer greed is driving the cryptocurrency higher, perhaps to USD 20,000 per coin by Christmas. This would put Bitcoin’s market cap above US$300 billion, one third that of Apple! Bitcoin is unique in history, true, but a correction will likely be very tough.
Two Chicago exchanges, the CBOE and the CME, will soon launch trading of cryptocurrency futures. This signals an impending stampede of institutional investors – many speculators, some hedgers. Just watch the fireworks fly.
Swiss inflation pause
November inflation in Switzerland fell slightly, allowing the Swiss National Bank to sign with relief. This allows the central bank to avoid tightening monetary policy. The bank and most exporters are pleased that the CHF has weakened 5.5% over the past year.
Markets are pricing in the first interest rate hike of only 0.25% only in March 2019. In 2018 the franc will remain a favourite funding currency. We remain positive on EUR/CHF and USD/CHF: dips are opportunities to reload long positions.