00:00 Josh

Let’s just start big picture, Scott, with these markets. Green across the screen. It’s been a roller coaster. I got the Dow up, it’s open more than 600 right now, Scott. Help me make sense of this. How how do you explain it?

00:15 Scott

Look, this this week, Josh, has been um frankly, a little bit confusing for a lot of folks. I mean, you know, we got we got really good data kind of across the board both from companies, like individual companies like Walmart and Nvidia. Uh we got uh you know, a pretty solid frankly employment report. uh and so like all the data looked pretty good. The price action obviously has been horrific outside of today. Um and so you know, to us this is this is speaking a lot towards uh you know, frankly a lot of P&L protection from from hedge funds. You know, guys have had reasonable years this year. Uh they don’t want to take a lot of risk. We’re seeing that sort of kind of show up in liquidity metrics that are pretty poor right now. Uh and a lot of technical selling coming out of uh systematic strategies like CTAs, uh bal targeting guys, uh you know, that like that kind of thing. So this is, you know, this is kind of a classic uh you know, good good data, bad uh bad price action week, which can be a little bit disconcerting for investors and for folks. Uh but but at the end of the day, it’s not really changing the medium the medium-term story for anything. We have a lot of tailwinds in this market.

01:07 Josh

Well, that that’s what I’m going to ask you. I mean, if the explanation, Scott, is, okay, year-end P&L, poor liquidity, I guess how long do you expect those sort of technical factors to overwhelm the fundamentals?

01:21 Scott

Look, it so it it looks like uh we’ve got probably we’re kind of going probably coming toward towards the end of a lot of this technical selling. It’s going to take a lot of volatility out of the S&P 500 or out of equity markets in general to keep the pace of selling going that we’ve got to basically keep the pressure on. Um you know, the the other thing that we that we need to see though is we you know, frankly and that you know, 2022 Scott Ladner would have scoffed at this, but if um if we don’t get stability out of Bitcoin, if we don’t get stability out of some of the some of the crypto space, uh it’s also going to be probably hard to really kind of catch a meaningful bid uh in risk assets broadly speaking. Um and so you know, this is so you know probably a couple conditions we got to get met. We got to get Bitcoin to at least stabilize uh and we we got to have some some of this sort of systematic selling pressure come off. We do think we’re probably seventh or eighth inning of the systematic selling side, though.

02:07 Josh

On Bitcoin, Scott, what how do you explain the selling there? I guess one. And two, do you see any signs or signals that hey, we we could be bottoming?

02:16 Scott

Look, the the uh anybody that can tell you that they can explain uh price movements of something like Bitcoin is probably probably spinning you a bit of a yarn. Uh but you but what what we do know is that, you know, we there’s a pretty important level around $77,000 in Bitcoin, which is essentially like the pre-election or I’m sorry, the the sort of the election day uh kind of highs and and also the April lows. Uh that’s that’s marked sort of a couple of pretty important pivots in the price of Bitcoin. If you’re looking at Bitcoin, you have to look at technicals. Uh there’s no fundamental value to it or sort of like pricing model to ascribe uh you know, sort of a value to Bitcoin. So you really got to look at technical levels and and that that $77,000 number is pretty important. Uh if we hold it and and we we got close to testing it overnight. If we hold that, then then we then we could get a little bit of a relief rally off of this. Uh but frankly, we’re just going to need to see positive price momentum start to take hold in that market. and that’s that’s really what’s going to end up turning it. just the standard more buyers than sellers thing.