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5 Hospitality Stocks For Your Summer 2022 Watchlist

Could investors be watching these hospitality stocks this summer?
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Check Out These Hospitality Stocks In The Stock Market Today

In the past couple of years, most investors likely avoided hospitality stocks thanks to the pandemic. With operations across various industries being forced to shut down, the hospitality industry was not spared from the implications of the Covid-19 pandemic. Fast forward to now, with restrictions largely being lifted, could it be time for investors to consider hospitality stocks once again? Although there are growing concerns about inflation taking its toll on the economy, it appears that some of the players in the industry remain bullish on their prospects.

For instance, Expedia’s (NASDAQ: EXPE) CEO Peter Kern believes that consumers will still be keen on traveling this summer season even with the higher inflation. “From what we can see of the US markets and western markets, there’s tons of pent-up demand,” Kern said in a Bloomberg interview on Wednesday. Moreover, in its earnings release last month, Expedia also provided an upbeat forecast. Other hospitality players such as Booking Holdings (NASDAQ: BKNG) and Airbnb (NASDAQ: ABNB) also shared the same sentiment in their respective quarterly reports. As such, could this coming summer holiday provide hospitality stocks a boost? If you believe so, here are five hospitality stocks to check out in the stock market today.

Hospitality Stocks For Your Summer Watchlist

Vail Resorts 

NYSE MTN

First up, we have Vail Resorts. For the uninitiated, Vail is among the top names in the ski resort business. The company operates through three segments. Most notably, its Mountain segment owns and operates 40 mountain resorts throughout three countries. Next to that, its Vail Resorts Hospitality segment owns luxury hotels under the RockResorts brand, condominiums, and golf courses. And finally, its Vail Resorts Development Company oversees property development and real estate holdings. Yesterday, the company posted its financials for the third quarter of fiscal 2022.

Getting straight to it, Vail reported a total net revenue of $1.18 billion, a commendable leap of 32.3% from last year. As for its earnings, the ski resort company raked in a net income of $372.6 million, or $9.16 per diluted share during the quarter. For comparison, it brought in $274.6 million, or $6.72 per diluted share in the prior year. In the same earnings report, Vail shared its outlook for the year. Namely, it updated its EBITDA guidance to be between $828 million and $842 million. With that being said, is MTN stock one to add to the portfolio?

[Read More] Best Gaming Stocks To Buy For 2022? 5 To Watch

Hilton Worldwide Holdings

HLT stock

Following that, we have Hilton Worldwide Holdings. Most would be familiar with this leading name in the global hospitality scene today. In essence, Hilton operates via a massive portfolio of 18 world-class brands. The likes of which span 6,900 properties, offering nearly 1.1 million rooms across 122 countries and territories worldwide. By the company’s estimates, it has housed over 3 billion guests since beginning operations over a century ago. 

Yesterday, the company announced plans to open one of the world’s largest Hampton by Hilton hotels in Vienna. This comes after a franchise agreement with Primestar Hospitality GmbH. Notably, Hilton has several franchise agreements with Primestar in Germany. The new development, which is set to open in Autumn 2024, will have 358 guest rooms graced by Hilton’s modern design which features contemporary furnishing and signature bedding. Along with that, the hotel will include a fully-equipped fitness center and an open concept lobby space. Considering this development, will you be watching HLT stock?

Hyatt Hotels 

H stock

Another hospitality stock worth noting today is Hyatt Hotels. As one of the world’s top hospitality companies, Hyatt commits itself to providing the best service for its guests. For the most part, the company manages and franchises luxury and business hotels, resorts, and vacation properties. To put into perspective the scale of Hyatt’s footprint, it has about 1,175 hotels and a total of 310,000 rooms. These hotels can be found in 69 countries across six continents.

Earlier this week, the company shared an operational update for May. For starters, its revenue per available room (RevPAR) was roughly $127, its strongest RevPAR performance in any month since November of 2019. Besides that, its average daily rate in May was about 8% above May 2019 levels, led by luxury brands in the Americas. Looking at the company’s performance, is H stock a buy?

Wyndham Hotels & Resorts 

WH stock chart

Wyndham Hotels & Resorts describes itself as the largest hotel franchisor in the world. It boasts over 9,280 locations and has a portfolio of 20 hotel brands which include the likes of Baymont, Days Inn, La Quinta, Wyndham, and more. The company operates through its Hotel Franchising segment and its Hotel Management segment. Last week, the company announced the opening of its first La Quinta and Hawthorn Suites dual-branded concept in Pflugerville, one of Texas’s fastest-growing suburbs. 

This first-of-its-kind pairing enables owners to reach guests seeking both extended-stay and leisure and business transient accommodations. As it stands, the dual-brand concept has contributed 48 hotels to Wyndham’s now record-setting development pipeline of over 1,500 hotels. The new Pflugerville property has a total of 103 rooms, with 73 La Quinta’s award-winning Del Sol prototype guest rooms and 30 Hawthorn Suites rooms. The new Hawthorn room design includes a fully-equipped kitchen to make the staying experience more home-like. With this update, would you be watching WH stock?

[Read More] Most Active Stocks To Buy Today? 4 Metaverse Stocks To Watch

Wynn Resorts

WYNN stock chart

Wynn Resorts is a developer and operator of high-end hotels and casinos. These would include the likes of Wynn Las Vegas, Encore Boston Harbor, Wynn Macau, and Wynn Palace, Cotai. In addition to that, the company also operates via its online gaming division, Wynn Interactive. The likes of which offer world-class online casino and sports betting experiences to consumers across the U.K. and the U.S. Last month, the company reported its financial results for the quarter ended March 31, 2022. 

According to the report, operating revenues were $953.3 million for the quarter, representing an increase of over 29% from $736.7 million in the prior year. Besides, Wynn managed to narrow its losses by a considerable amount. Namely, it reported a loss of $183.3 million as compared to $281.0 million in 2021. “Our first-quarter results reflect continued strength at both Wynn Las Vegas and Encore Boston Harbor where our teams’ unrelenting focus on five-star hospitality and world-class experiences combined with very strong customer demand to deliver a new first-quarter record for Adjusted Property EBITDA at both properties,” said CEO Craig Billings. As such, is WYNN stock worth watching?

If you enjoyed this article and you’re interested in learning how to trade so you can have the best chance to profit consistently then you need to checkout this YouTube channel. CLICK HERE RIGHT NOW!!

The post 5 Hospitality Stocks For Your Summer 2022 Watchlist appeared first on Stock Market News, Quotes, Charts and Financial Information | StockMarket.com.

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Price analysis 8/8: BTC, ETH, BNB, XRP, ADA, SOL, DOGE, DOT, MATIC, AVAX

Bitcoin price aims to break from its current range and flip $24,000 to support, while altcoins are following the upside move by attempting to confirm their…

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Bitcoin price aims to break from its current range and flip $24,000 to support, while altcoins are following the upside move by attempting to confirm their bottoming patterns.

The United States equities markets and the cryptocurrency markets have started the week on a strong note, indicating that traders are not nervous about buying ahead of the important Consumer Price Index (CPI) data for July, which will be released on Aug. 10.

Another positive sign is that the recent recovery in Bitcoin (BTC) has not tempted investors to exit their positions in fear of another leg down. Glassnode data shows that the percentage of supply that has stayed dormant for three or more years rose to a new all-time high of 38.426% on Aug. 8.

Daily cryptocurrency market performance. Source: Coin360

BlackRock CEO Larry Fink sold 44,000 BlackRock shares in August, the biggest sale since the COVID-19 crash. Some analysts are speculating that the current recovery in the equities markets is only a bear market rally. If that is the case, then a downturn in the equities markets could also increase the selling in crypto prices as both remain closely correlated.

Could Bitcoin and select altcoins climb above their respective overhead resistance levels and extend the recovery in the short term? Let’s study the charts of the top-10 cryptocurrencies to find out.

BTC/USDT

Bitcoin bounced off the 20-day exponential moving average (EMA)($22,846) on Aug. 7 and the momentum picked up on Aug. 8. The buyers pushed the price above $24,000 and could challenge the overhead resistance at $24,668.

BTC/USDT daily chart. Source: TradingView

The 20-day EMA is sloping up and the relative strength index (RSI) is in the positive territory, indicating that bulls are in control. If buyers propel the price above the overhead resistance, the BTC/USDT pair could pick up momentum and rally to $28,000 as there is no significant resistance in between. The bears may try to stall the recovery at this level but if bulls overcome this barrier, the up-move could reach $32,000.

Contrary to this assumption, if the price turns down from $24,668, the pair could drop to the 20-day EMA. This is an important level to watch out for because a break below it could drag the price to the 50-day simple moving average (SMA($21,594). A break below this level could put the bears back on top.

ETH/USDT

Buyers pushed Ether (ETH) above the overhead resistance at $1,700 on Aug. 5 and the bulls successfully defended the breakout level on Aug. 6 and 7. Buying resumed on Aug. 8 and the bulls pushed the price above the overhead resistance at $1,785.

ETH/USDT daily chart. Source: TradingView

If bulls sustain the price above $1,785, the ETH/USDT pair could pick up momentum and rally to the psychological level at $2,000. This level may attract selling by the bears but if bulls arrest the next decline above $1,700, the likelihood of a break above $2,000 increases. If that happens, the pair could rally to the downtrend line.

This positive view could invalidate in the short term if the price turns down and breaks below the 20-day EMA ($1,606). The pair could then slide to the 50-day SMA ($1,362).

BNB/USDT

BNB recovery has reached the strong overhead resistance zone between $338 and $350 where the bears are expected to mount a strong defense.

BNB/USDT daily chart. Source: TradingView

If the price turns down from the current level, the BNB/USDT pair could decline to the 20-day EMA ($289). This is an important level to keep an eye on because a strong bounce off it will suggest that the positive sentiment remains intact and traders are viewing dips as a buying opportunity.

The bulls will then make one more attempt to clear the overhead zone. If they succeed, the BNB/USDT pair could further pick up momentum and rally toward $414. This positive view could invalidate in the short term if the price turns down and breaks below the 20-day EMA.

XRP/USDT

XRP’s price has been squeezed between the 20-day EMA ($0.36) and the overhead resistance at $0.39 for the past few days. Usually, such tight ranges lead to a range expansion.

XRP/USDT daily chart. Source: TradingView

The rising 20-day EMA and the RSI in the positive area indicate advantage to buyers. If bulls push and sustain the price above $0.39, it will suggest the start of a new up-move. The XRP/USDT pair could then rise to $0.48 and later to $0.54.

This positive view will invalidate in the near term if the price turns down and breaks below the 20-day EMA. The pair could then drop to the 50-day SMA ($0.35). Such a move will suggest that the pair may spend some more time inside the range.

ADA/USDT

Cardano (ADA) bounced off the 20-day EMA ($0.50) on Aug. 5 and has reached the strong overhead resistance at $0.55.

ADA/USDT daily chart. Source: TradingView

The 20-day EMA is sloping up and the RSI is in the positive territory, indicating that the path of least resistance is to the upside. If buyers thrust the price above $0.55, the ADA/USDT pair could start its northward march toward $0.63 and then to $0.70. The bears may pose a strong challenge at this level.

To invalidate this positive view, the bears will have to sink and sustain the price below the 50-day SMA. That could extend the stay of the pair inside the range between $0.40 and $0.55 for a few more days.

SOL/USDT

Solana (SOL) rose above the 20-day EMA ($40) on Aug. 5 and the bulls thwarted attempts by the bears to sink the price back below the level. The buying resumed on Aug. 8 and the bulls will attempt to push the price to the overhead resistance at $48.

SOL/USDT daily chart. Source: TradingView

The 20-day EMA is rising up gradually and the RSI is in the positive zone, indicating that the bulls have the upper hand. If buyers drive the price above $48, the bullish ascending triangle pattern will complete. The pair could then start a rally to $60 and thereafter to the pattern target at $71.

Alternatively, if the price turns down from $48 like the previous two occasions, it will suggest that bears are defending the level aggressively. That could keep the pair stuck inside the triangle for a few more days. The bullish setup will invalidate on a break below the support line.

DOGE/USDT

Dogecoin (DOGE) bounced off the 20-day EMA ($0.07) on Aug. 7, indicating that bulls are defending the moving averages with vigor. However, the long wick on the Aug. 8 candlestick suggests that bears are selling at higher levels.

DOGE/USDT daily chart. Source: TradingView

The flattish moving averages indicate a balance between supply and demand but the RSI in the positive territory suggests a minor advantage to the buyers. If bulls push the price above the overhead resistance at $0.08, it will complete the ascending triangle pattern. The pair could then start a rally to the psychological resistance at $0.10.

Conversely, if the price turns down from the overhead resistance, the DOGE/USDT pair could stay inside the triangle for a few more days. The bears will have to sink the price below the trendline to invalidate the bullish setup.

Related: Metaverse housing bubble bursting? Virtual land prices crash 85% amid waning interest

DOT/USDT

Polkadot (DOT) turned down from the overhead resistance at $9 on Aug. 6 but the bulls did not cede ground to the bears. They resumed their purchase on Aug. 7 and pushed the price above the overhead resistance on Aug. 8.

DOT/USDT daily chart. Source: TradingView

The 20-day EMA is sloping up and the RSI is in the positive territory, indicating that bulls have the upper hand. If buyers sustain the price above $9, the bullish momentum could pick up and the DOT/USDT pair could rise to $10.80 and later to $12.

Contrary to this assumption, if the price turns down and breaks back below $9, it will suggest that the breakout may have been a bull trap. The pair could then decline to the 20-day EMA ($8.07) and later to the 50-day SMA ($7.49).

MATIC/USDT

Polygon (MATIC) formed a Doji candlestick pattern on Aug. 7, which resolved to the upside on Aug. 8. This suggests that bulls are buying the dips to the 20-day EMA ($0.86).

MATIC/USDT daily chart. Source: TradingView

The upsloping moving averages and the RSI in the positive territory indicate advantage to buyers. The MATIC/USDT pair could rise to the overhead resistance at $1.02 where the bears may mount a strong defense.

If bulls do not give up much ground from $1.02, the likelihood of a break above it increases. The pair could then rally to $1.26 and then to $1.50. The first sign of weakness will be a break and close below the 20-day EMA. That could open the doors for a possible drop to $0.75.

AVAX/USDT

Avalanche (AVAX) broke and closed above the strong overhead resistance at $26.38 on Aug. 6, indicating the completion of the bullish ascending triangle pattern.

AVAX/USDT daily chart. Source: TradingView

The AVAX/USDT pair could rise to $33 and later to the pattern target of $39.05. While the upsloping moving averages indicate advantage to buyers, the RSI has risen into the overbought zone, suggesting a minor correction in the near term.

If bulls flip the $26.38 level into support during the next correction, it will signal a potential trend change. This positive view could be invalidated in the near term if the price turns down and breaks below the moving averages.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

Market data is provided by HitBTC exchange.

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Best Penny Stocks To Buy: 4 Short Squeeze Stocks To Watch Now

Penny stocks to buy: Here’s what short interest traders think
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Penny Stocks To Buy: What To Look For

This article will discuss a handful of penny stocks to buy according to those looking for short squeeze stocks. If you’ve seen our other articles about cheap stocks with high short interest, you know that there are a lot of risks that go along with potential rewards. A quick yield means everything to traders looking to catch a short squeeze. The moves up can be legendary, but the moves lower can bring crushing blows to anyway caught on the wrong side of the trade.

The last few weeks have shown the market exactly how massive short squeezes can grow. AMTD Digital (NYSE:HKD) was the fuse that sparked the snowball effect for these trading trends. This week that continued with the latest penny stock to squeeze: Intelligent Living (NASDAQ:ILAG).

In most cases, there is very little news, if any, to act as a fundamental catalyst. With the majority of short-interest stocks, technical aspects of trading take precedence. Case in point, ILAG stock exploded 260% within about a day’s worth of time and the company didn’t release a shred of news or a single corporate filing. But it does have a tiny float and bullish momentum heading into the Monday session, which set the stage for the latest move.

Penny Stocks To Buy With High Short Interest

Does this mean all penny stocks with high short interest are destined for massive breakouts? No, and there’s usually a reason for high short interest. It usually doesn’t coincide with companies doing record revenues or experiencing ongoing growth.

Short interest grows based on traders betting the stock will fail. They’ll short it by borrowing shares from a broker, selling them, then repurchasing them later when prices are lower to return the borrow.

How To Find Short Squeeze Stocks

When a short squeeze triggers, prices move in the opposite direction, forcing shorts to cover their positions early and either break even or take a loss. This short covering, paired with high levels of retail buying, triggers a more significant move in the stock.

Let’s look at a handful of penny stocks with higher short interest. Data we’ve found using resources like TrueTradingGroup.com’s Unusual Options & Short Data Tool.

  1. Karyopharm Therapeutics Inc. (NASDAQ:KPTI)
  2. Helbiz Inc. (NASDAQ:HLBZ)
  3. Purple Innovation Inc. (NASDAQ:PRPL)
  4. Ostin Technology Group (NASDAQ:OST)

1. Karyopharm Therapeutics Inc. (NASDAQ: KPTI)

KPTI Stock Price as of this Article: $4.85

What Does Karyopharm Therapeutics Do?

The commercial stage pharmaceutical company develops cancer therapies, including multiple myeloma, endometrial cancer, myelodysplastic syndromes and myelofibrosis. Its lead SINE compound and XPOVIO platform is approved in the US in three oncology indications. Last quarter, the company achieved net product revenue 44% higher than Q2 2021 at $29 million. It also received full marketing authorization by the European Commission Expanding Indication for NEXPOVIO (trade name in Europe) for adults with multiple myeloma.

[Read More] Best Penny Stocks To Buy In August According To Insiders, 1 Bet Over $2 Million

A sales and earnings beat has helped build back some optimism that was lost over the last few months. It was also enough to raise the eyebrows of HC Wainwright analysts, who reiterated a Buy on KPTI stock and paired it with an $18 target.

KPTI Stock: A Short Squeeze Stock To Watch?

According to data from TrueTradingGroup.com’s Unusual Options & Short Data Tool, the current short float on KPTI stock is 25.11%.

2. Helbiz Inc. (NASDAQ: HLBZ)

HLBZ Stock Price as of this Article: $1.31

What Does Helbiz Do?

Another one of the names on this list of penny stocks is Helbiz Inc. The company specializes in “micro-mobility,” which is a fancy word for things like eScooters, eBikes, and eMopeds. Its fleet management technology uses artificial intelligence and environmental mapping to sustainably scale and manage its assets.

A recent partnership with Logan City Council in Australia will see Helbiz operate up to 400 eScooters and 400 eBikes later this month. “This latest partnership marks a significant step towards bringing safe, sustainable transportation alternatives to Australia. This announcement follows the plan to introduce 500 e-bikes in Sydney and 100 e-scooters in Alloggio resorts later this year,” said Mitchell Price, Helbiz Australia Managing Director.

HLBZ Stock: A Short Squeeze Stock To Watch?

According to data from TrueTradingGroup.com’s Unusual Options & Short Data Tool, the current short float on HLBZ stock is 32.64%.

3. Purple Innovation Inc. (NASDAQ: PRPL)

PRPL Stock Price as of this Article: $4.22

What Does Purple Innovation Do?

Purple Innovation is a slower and steadier mover compared to other names on this list of penny stocks. Shares have climbed from lows of $2.90 to highs of $4.40 over the last few weeks as PRPL stock attempts to reclaim some of this year’s losses.

[Read More] Best Penny Stocks To Buy? 3 To Watch After MEGL Stock Hits 5798%

You may have seen Purple advertised on social media for its “no pressure mattress” technology. The company offers “comfort solutions” ranging from mattresses and pillows to bedding and frames. This week investors are likely waiting to see if Purple can turn things around. The next round of earnings comes on August 9th, and guidance will probably be on the menu. Last quarter, Purple management cut its guidance.

Chief Executive Officer Rob DeMartini explained, “We remain in the early stages of creating the framework for strong operational execution. While we are making progress and believe we will see sequential improvements, including second-half profitability during this year, evolving economic and post-pandemic headwinds such as a shift in consumer buying behavior from online to in-stores and away from home related categories toward experiences and travel, has caused us to adopt a more conservative view on the remainder of 2022.”

PRPL Stock: A Short Squeeze Stock To Watch?

According to data from TrueTradingGroup.com’s Unusual Options & Short Data Tool, the current short float on PRPL stock is 25.24%.

4. Ostin Technology Group (NASDAQ:OST)

OST Stock Price as of this Article: $3.12

What Does Ostin Technology Do?

Ostin Technology supplies display modules and polarizers in China. It recently secured a $2.6 million deal for a purchase order of LCD/TP display modules expected for use in iGame G-ONE Plus gaming PCs.

CEO Tao Ling said in a July update, “We believe our products are able to power the iGame G-ONE Plus AIO gaming PC and provide an unrivaled gaming experience for gamers. We are dedicated to meet our customers’ evolving needs and have focused on establishing and maintaining long term relationships with our customers, in an effort to ensure our sustained development and improved profitability.”

OST Stock: A Short Squeeze Stock To Watch?

Other than the short float percentage, the borrow fee rate is something that traders look at. This is a fee that a broker charges for borrowing shares. Typically, the higher the fee, the more difficult it is to borrow the stock. According to data from TrueTradingGroup.com’s Unusual Options & Short Data Tool, the current borrow fee rate on OST stock is 56.71%.

Penny Stocks To Buy For Beginners

If you’re brand new to trading penny stocks in 2022, here are a few good articles to check out and some extra info on the best way to learn how to day trade, swing trade, or invest for the long-term:

If you’re interested in learning more about penny stocks, the stock market, and how to trade, check out True Trading Group, the fastest growing & highest-rated online premium educational platform available today. True Trading Group offers a 7-day Trial of its platform for $3 (non-autorenewing, nonrecurring): To Learn More Click Here.

If you enjoyed this article and you’re interested in learning how to trade so you can have the best chance to profit consistently then you need to checkout this YouTube channel. CLICK HERE RIGHT NOW!!

The post Best Penny Stocks To Buy: 4 Short Squeeze Stocks To Watch Now appeared first on Penny Stocks to Buy, Picks, News and Information | PennyStocks.com.

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Fed reverse repo reaches $2.3T, but what does it mean for crypto investors?

Investors avoid risk assets during a crisis, but excessive cash sitting in financial institutions could also be good for the cryptocurrencies.

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Investors avoid risk assets during a crisis, but excessive cash sitting in financial institutions could also be good for the cryptocurrencies.

The U.S. Federal Reserve (FED) recently initiated an attempt to reduce its $8.9 trillion balance sheet by halting billions of dollars worth of treasuries and bond purchases. The measures were implemented in June 2022 and coincided with the total crypto market capitalization falling below $1.2 trillion, the lowest level seen since January 2021. 

A similar movement happened to the Russell 2000, which reached 1,650 points on June 16, levels unseen since November 2020. Since this drop, the index has gained 16.5%, while the total crypto market capitalization has not been able to reclaim the $1.2 trillion level.

This apparent disconnection between crypto and stock markets has caused investors to question whether the Federal Reserve’s growing balance sheet could lead to a longer than expected crypto winter.

The FED will do whatever it takes to combat inflation

To subdue the economic downturn caused by restrictive government-imposed measures during the Covid-19 pandemic, the Federal Reserve added $4.7 trillion to bonds and mortgage-backed securities from January 2020 to February 2022.

The unexpected result of these efforts was 40-year high inflation and in June, U.S. consumer prices jumped by 9.1% versus 2021. On July 13, President Joe Biden said that the June inflation data was "unacceptably high." Furthermore, Federal Reserve chair Jerome Powell stated on July 27:

“It is essential that we bring inflation down to our 2 percent goal if we are to have a sustained period of strong labor market conditions that benefit all.”

That is the core reason the central bank is withdrawing its stimulus activities at an unprecedented speed.

Financial institutions have a cash abundance issue

A "repurchase agreement," or repo, is a short-term transaction with a repurchase guarantee. Similar to a collateralized loan, a borrower sells securities in exchange for an overnight funding rate under this contractual arrangement.

In a "reverse repo," market participants lend cash to the U.S. Federal Reserve in exchange for U.S. Treasuries and agency-backed securities. The lending side comprises hedge funds, financial institutions and pension funds.

If these money managers are unwilling to allocate capital to lending products or even offer credit to their counterparties, then having so much cash at disposal is not inherently positive because they must provide returns to depositors.

Federal Reserve overnight reverse repurchase agreements, USD. Source: St. Louis FED

On July 29, the Federal Reserve's Overnight Reverse Repo Facility hit $2.3 trillion, nearing its all-time high. However, holding this much cash in short-term fixed income assets will cause investors to bleed in the long term considering the current high inflation. One thing that is possible is that this excessive liquidity will eventually move into risk markets and assets.

While the record-high demand for parking cash might signal a lack of trust in counterparty credit or even a sluggish economy, for risk assets, there is the possibility of increased inflow.

Sure, if one thinks the economy will tank, cryptocurrencies and volatile assets are the last places on earth to seek shelter. However, at some point, these investors will not take further losses by relying on short-term debt instruments that do not cover inflation.

Think of the Reverse Repo as a "safety tax," a loss someone is willing to incur for the lowest risk possible — the Federal Reserve. At some point, investors will either regain confidence in the economy, which positively impacts risk assets or they will no longer accept returns below the inflation level.

In short, all this cash is waiting on the sidelines for an entry point, whether real estate, bonds, equities, currencies, commodities or crypto. Unless runaway inflation magically goes away, a portion of this $2.3 trillion will eventually flow to other assets.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

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