Imagine you’re waiting for the floodgates to open, hoping a bunch of coins will pour into the market and make things lively. That’s kind of like what’s happening with RRP (Reverse Repo). Ideally, we want that number to go down—because when it does, it’s like the market’s unlocking more liquidity. But right now, it’s stuck, Friday it was 98, then Monday it even went up a bit to 102 billion. So, no flood yet.
Meanwhile, the US Dollar (DXY) is acting weird. Normally, when other currencies fall, the dollar gets stronger—it’s like the reliable inflation-proof bunker. But now? It’s sliding too. And instead of owning it, the US is pointing fingers, saying China’s devaluing the Yuan. But honestly, it’s not that simple—Japan isn’t dumping US bonds without permission. The US has allies like Japan and Qatar that don’t really move without a green light. For example, Qatar even admitted it opened and funded the Hamas office at the US’s request. Makes you wonder who’s really pulling the strings.
And now, there’s this sneaky feeling—what if China and Trump are quietly making eyes at each other? Because China hasn’t sold off its US bonds yet. Japan is acting like the fall guy, taking the hit, while China just sits cool. Pretty clever, right?
But what about Bitcoin today? That’s really the question I keep circling back to. With all this chaos—currencies weakening, US stocks dropping, no strong economic data from the US, and the dollar crashing too—Bitcoin is looking green. Like, actually rising.
I’ve been watching the Yuan and Yen fall. The Chinese central bank (PBOC) injected money into the system without taking any out—almost like pumping air into a balloon. If the effect kicks in after three days, today’s the day we should see that balloon float… and the Yuan get weaker.
People like Hartnett are recommending betting on 2-year yields going up and shorting the S&P 500. That tells you something. If investors are choosing a boring 3.85% return over running a business, they’re playing it safe. But smaller investors? They’re not excited about low-yield bonds. They’d rather put their money in high-risk plays… like Bitcoin. So it climbs.
And tomorrow? Big Powell day. But I doubt he’ll be super hawkish. Why? Because Japan has already been offloading a ton of US bonds, and Powell probably needs to absorb that without panicking the markets. If he stays soft, China might jump in next and drop a hammer. That could hurt the dollar even more.
Meanwhile, in China, some banks have dropped deposit rates below 2%. That’s like saying, “Hey, don’t park your money here, go spend or invest it!” So people might start buying stocks, which increases liquidity. More liquidity? Bitcoin loves that.
Oh, and geopolitics is brewing too. The US is possibly trying to cozy up to Russia again. Why? Back in the day, the US used investments and tech to get China to drift away from Russia. Now that China’s a strong rival, the US might try the same trick on Russia—to keep them from teaming up. But Putin? He’s already turned down sweet deals to stay close to Iran. So we’ll see if he stays loyal to China this time.
Back to Japan: their central bank isn’t raising rates anytime soon. That keeps Yen flowing and inflation rising. And when that decision hits the wires, watch Bitcoin jump again—because easy money means more action in riskier assets.
Lastly, Morgan Stanley says China might cut bank reserve ratios and interest rates soon, and plans to inject RMB 1 to 1.5 trillion in stimulus later this year. All that fresh cash in circulation? That’s good news for Bitcoin too, especially in Asian hours when that liquidity kicks in.
And China’s shouting loud and clear: “We’re open for business and ready to attract more global investment.”
So… dear USA, where you at?
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