QCP Capital said in its latest market analysis that the stock market is unusually optimistic, with US stocks at all-time highs and Asian stocks largely bullish today as the market expects the US to cut interest rates and achieve a soft landing.
However, there are still signs of nervousness in the market, as the options market expects Powell's speech at Jackson Hole on Friday to cause a 1% move in the S&P 500.
In contrast to stocks, the sentiment in the cryptocurrency market is very pessimistic. Last weekend, the funding rate for Bitcoin perpetual contracts fell to -13%, the lowest level since 2022.
The market seems to have ignored the possibility of further unwinding of the yen/dollar carry trade. According to Bloomberg, funds such as Vanguard are increasing their bets on further interest rate hikes by the Bank of Japan. Whether this will be a catalyst for another decline in the entire market is unknown.
However, QCP added that it remains optimistic and bullish on the market.