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Crypto Trading Cycle Flips: Asia’s Now Buying What Americans Are Dumping

Crypto Trading Cycle Flips: Asia’s Now Buying What Americans Are Dumping

Late in 2021 we detailed the strange phenomenon whereby crypto markets…

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Crypto Trading Cycle Flips: Asia's Now Buying What Americans Are Dumping

Late in 2021 we detailed the strange phenomenon whereby crypto markets were dramatically underperforming during the overnight (Asia) session relative to the US day session.

Whoever (or whatever - cough Asian central banks cough) was 'selling' crypto overnight was met with a volley of bids from US whales scooping up that 'cheap' coin.

But now, as scorched-earth regulatory pressures perhaps swing from Beijing to Washington, that regime has flipped with US 'paper hands' dumping their crypto during the US day-session as Asian HODLers scoop up the 'cheap' coins overnight.

Specifically, as the chart above shows, a hypothetical strategy that buys the coin at the equity-market close (at 1600ET) and sells it at the next day’s open (0930ET) yields gains of roughly 260% going back to the start of 2020, according to Bespoke Investment Group.

Conversely, buying it at the US market open and selling it at the close spits out an advance of 3.6%.

The coin even tends to trend higher during weekends, the firm found, when stock investors are resting or barbecuing or doing whatever weekend activities they’re fond of.

While no one seems to be able to agree on why this might be happening, Bloomberg's Vildana Hajric and Katie Greifeld outline five perspectives on why the phenomenon might be happening:

1. The Nature of a 24/7 Market

The fact that cryptocurrencies trade around the clock every day of the week makes Bitcoin, by default, the most watched and traded asset when traditional markets are closed, and that’s a top reason for the overnight phenomenon, says Bloomberg Intelligence’s Mike McGlone. 

“It’s the most fluid global 24/7 trading vehicle in history, which means it’s a leading indicator on the downside too,” he said.

2. Geographical Differences

In the US and certain other geographies, riskier assets have sold off this year as the Federal Reserve and other central banks institute policies to combat high inflation. But that might not be the case everywhere, and risk-on attitudes may still be at play across Asia, for instance, says Noelle Acheson, head of market insights at Genesis Global Trading.

Back in 2015 and 2016, China had been a focal point for Bitcoin trading -- that’s where mining took off and most of the trading volume originated, she said. “There are different cultural attitudes toward riskier investments.”

Source: Glassnode, as of June 8

In addition, some investors might be more drawn toward using leverage, and international venues are sometimes more permissive in that way. Original crypto exchanges used to offer 125x leverage, said Acheson, though, in the US, regulators have looked to curtail such access. “So they are much more used to high leverage, it’s much more what they expect,” she said.

3. Longer Span of Time

Bitcoin’s correlation to equities could be another factor at work, which is something analysts have been pointing to all year as both cryptos and equities have sold off. Both stocks and digital assets are considered riskier plays, so the two have moved hand-in-hand, says Jake Gordon at Bespoke Investment Group.

Still, the correlation to stocks may not explain why the trend of after-hours outperformance also existed when the market was rallying over the past two years, he said. So another explanation is that the post-close strategy covers a longer span of time, “meaning there is the potential for more news/catalysts to account for.”

4. Watching the Charts

From 2021 onwards, due to China’s crackdown on crypto, trading volumes and flows have tended to peak around 9:30 a.m. Eastern Time, according to Chiente Hsu, co-founder and CEO at ALEX, a DeFi platform. “So trading volume is highly correlated to the US stock market trading hours,” she said in an interview. Hsu, who used to work at Morgan Stanley, cited a research paper showing that the overnight trend of buying at the close and selling at the open was also prevalent in the stock market before the pandemic.

But why might that be the case? Hsu says information flows build up overnight, though that’s mostly prevalent during uptrend markets. What about bear markets? “In a downtrend market, it shouldn’t work, particularly in very volatile, range-bound markets,” she said, adding that she’d like to see more research on these types of topics, as well as how transaction costs play a part.

5. Correlations

Vetle Lunde, analyst at Arcane Research, says he expected US trading hours to be the most significant contributor to the Bitcoin selloff in recent months, but hadn’t expected to see that being the only contributor. “Then again, it confirms what we’ve seen elsewhere in the market,” Lunde said, citing the coin’s strong correlation to stocks this year.

“We saw in mid-2020 to early 2021 that US trading hours were the key trading hours for the initial liftoff during the early bull market. That period was characterized as a period of huge institutional flows into Bitcoin,” Lunde wrote in a message.

Now, most of the institutional market has been focused on de-risking, with the macro backdrop related to inflation and interest-rate hikes being the key component behind the de-risking. This has most definitely had a severe impact on Bitcoin and is likely the root cause behind the very potent continuous selling pressure during US trading hours.”

Finally, as we detailed previously, we suggest another more ominous reason for Asia's bid for alternative currency. Traders are front-running the growing risk that China, and its $54 trillion in bank assets or 150% more than the US...

... will suffer another devaluation, sparking another massive capital exodus using bitcoin and other crypto instruments.

As UBS previously noted, none of this is to argue that crypto is sliding into oblivion, quite the contrary - after all Wall Street and Silicon Valley have invested tens of billions in crypto infrastructure and manpower (most did so around the time cryptos peaked),. Yet what it does point to is how the future will look very different. According to UBS' James Malcom, players will have to embrace regulation and collaborate with existing financial service providers; thus Singapore's just-launched Project Guardian, which represents a pilot project for the central bank to explore tokenized bonds and deposits via the establishment of permissioned liquidity pools in collaboration with DBS, JPMorgan and Marketnode. They must also have to compromise even as they seek to disrupt longstanding tradfi practices, per FTX's bold bid to disintermediate derivatives trading by clearing customers' swaps without the involvement of FCMs.

The good news is that, as UBS concludes, those who can last beyond the near-term downward pressure and volatility, the longer-term demand-side outlook looks exceedingly healthy when recast in such terms. Accenture's newly released Future of Asian Wealth Management survey revealed that more than half of its 3,200 respondents already hold digital assets, and nearly three quarters plan to do so by year-end. However, two thirds of the 500 financial advisors surveyed have no plans to offer such services due to regulatory uncertainty and unfamiliarity with the space, which would require specialized research capabilities plus substantial investment in training for relationship managers.  Little wonder satisfaction ratings with primary counterparts score rather lowly.  It is also not surprising that many allocators end up relying on potentially less reliable online advice in consequence. UBS' Global Family Office Report 2022 finds, by contrast, most of the bank's clients are 'cryptocurious' rather than 'crypto-committed'— wanting to learn about the space rather than invest. It pegged just a quarter of Asian participants as active in the space, though that rises to more than a third in North America. The vast majority of allocations amount to less than 3% of portfolios and are being made to better understand the technology as much as on the expectation of strong, diversified returns at this point.

Tyler Durden Mon, 06/13/2022 - 12:45

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Government

Family Of College Student Who Died From COVID-19 Vaccine Sues Biden Administration

Family Of College Student Who Died From COVID-19 Vaccine Sues Biden Administration

Authored by Zachary Stieber via The Epoch Times (emphasis…

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Family Of College Student Who Died From COVID-19 Vaccine Sues Biden Administration

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

The family of a college student who died from heart inflammation caused by Pfizer’s COVID-19 vaccine has sued President Joe Biden’s administration, alleging officials engaged in “willful misconduct.”

George Watts Jr. in a file image. (Courtesy of the Watts family)

U.S. Department of Defense (DOD) officials wrongly promoted COVID-19 vaccination by repeatedly claiming the available vaccines were “safe and effective,” relatives of George Watts Jr., the college student, said in the new lawsuit.

That promotion “duped millions of Americans, including Mr. Watts, into being DOD’s human subjects in its medical experiment, the largest in modern history,” the suit states.

The Public Readiness and Emergency Preparedness Act allows lawsuits against certain people if they have engaged in “willful misconduct” and if that misconduct caused death or serious injury.

COVID-19 vaccines are covered by the act due to a declaration entered during the Trump administration in 2020 after COVID-19 began circulating.

DOD’s conduct and the harm caused as alleged within the four corners of the lawsuit speaks for itself,” Ray Flores, a lawyer representing the Watts family, told The Epoch Times via email. “I have no further comment other than to say: My only duty is to advocate for my client. If the DOD conveys a settlement offer, I will see that it’s considered.”

The suit was filed in U.S. court in Washington.

The Pentagon and the Department of Justice did not respond to requests for comment.

Watts Suddenly Died

Watts was a student at Corning Community College when the school mandated COVID-19 vaccination for in-person classes in 2021. He received one Pfizer dose on Aug. 27, 2021, and a second dose approximately three weeks later.

Watts soon began experiencing a range of symptoms, including tingling in the feet, pain in the heels, numbness in the hands and fingers, blood in his sperm and urine, and sinus pressure, according to family members and health records.

Watts went to the Robert Packer Hospital emergency room on Oct. 12, 2021, due to the symptoms. X-rays showed clear lungs and a normal heart outline.

Watts was sent home with suggestions to follow up with specialists but returned to the emergency room on Oct. 19, 2021, with worsening symptoms despite a week of the antibiotic Augmentin. He was diagnosed with sinusitis and bronchitis.

While speaking to his mother at home on Oct. 27, 2021, Watts suddenly collapsed. Emergency medical personnel rushed to the home but found him unresponsive. He was rushed to the same hospital in an ambulance. He was pronounced deceased at age 24.

According to a doctor at the hospital, citing hospital records and family members, Watts had no past medical history on file that would explain his sudden death, with no known history of substance abuse or obvious signs of substance abuse. His mother described her son as a “healthy young male.”

Dr. Robert Stoppacher, a pathologist who performed an autopsy on the body, said that the death was due to “COVID-19 vaccine-related myocarditis.” The death certificate listed no other causes. A COVID-19 test returned negative. Dr. Sanjay Verma, based in California, reviewed the documents in the Watts case and said that he believed the death was caused by the COVID-19 vaccination.

Pfizer did not respond to a request for comment.

Watts Took Vaccine Under Pressure

The community college mandate included a 35-day grace period following approval by the U.S. Food and Drug Administration (FDA) of a COVID-19 vaccine.

The Moderna, Pfizer, and Johnson & Johnson vaccines were given emergency use authorization early in the pandemic. The FDA approved the Pfizer shot on Aug. 23, 2021. It was the first COVID-19 vaccine approval. But doses of the approved version of the shot, branded Comirnaty, were not available for months after the approval.

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Tyler Durden Fri, 06/02/2023 - 23:00

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International

US Sent Billions in Funding to China, Russia For Cat Experiments, Wuhan Lab Research: Ernst

US Sent Billions in Funding to China, Russia For Cat Experiments, Wuhan Lab Research: Ernst

Authored by Mark Tapscott via The Epoch Times…

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US Sent Billions in Funding to China, Russia For Cat Experiments, Wuhan Lab Research: Ernst

Authored by Mark Tapscott via The Epoch Times (emphasis ours),

Hundreds of millions of U.S. tax dollars went to recipients in China and Russia in recent years without being properly tracked by the federal government, including a grant that enabled a state-run Russian lab to test cats on treadmills, according to Sen. Joni Ernst (R-Iowa).

Sen. Joni Ernst (R-Iowa) speaks at a Senate Republican news conference in the U.S. Capitol on March 9, 2022. (Anna Moneymaker/Getty Images)

Ernst and her staff investigators, working with auditors at the Government Accountability Office (GAO) and the Congressional Research Service, as well as two nonprofit Washington watchdogs—Open The Books (OTB) and the White Coat Waste Project (WCWP)—discovered dozens of other grants that weren’t counted on the federal government’s USASpending.gov internet database.

While the total value of the uncounted grants found by the Ernst team is $1.3 billion, that amount is just the tip of the iceberg, the GAO reported.

Among the newly discovered grants is $4.2 million to China’s infamous Wuhan Institute of Virology (WIV) “to conduct dangerous experiments on bat coronaviruses and transgenic mice,” according to a May 31 Ernst statement provided to The Epoch Times.

The $4.2 million exposed by Ernst is in addition to previously reported funding to the WIV for extensive gain-of-function research by Chinese scientists, much of it funded in whole or part prior to the COVID-19 pandemic by National Institutes for Health (NIH) grants channeled through the EcoHealth Alliance medical research nonprofit.

The NIH has awarded seven grants totaling more than $4.1 million to EcoHealth to study various aspects of SARS, MERS, and other coronavirus diseases.

Buying Chinese Puppy Parts

As part of another U.S.-funded grant, hearts and other organs from 425 dogs in China were purchased for medical research.

These countryside dogs in China are part of the farmer’s household; they were mainly used for guarding. Their diet includes boiled rice, discarded raw food animal tissues, and whatever dogs can forage. These dogs were sold for food,” an NIH study uncovered by the Ernst researchers reads.

Other previously unreported grants exposed by the Ernst team include $1.6 million to Chinese companies from the federal government’s National School Lunch Program and $4.7 million for health insurance from a Russian company that was sanctioned by the United States in 2022 as a result of the invasion of Ukraine.

“It’s gravely concerning that Washington’s reckless spending has reached the point where nobody really knows where all tax dollars are going,” Ernst separately told The Epoch Times. “But I have the receipts, and I’m shining a light on this, so bureaucrats can no longer cover up their tracks, and taxpayers can know exactly what their hard-earned dollars are funding.”

The problem is that federal officials don’t rigorously track sub-awards made by initial grant recipients, according to the Iowa Republican. Such sub-awards are covered by a multitude of federal regulations that stipulate many conditions to ensure that the tax dollars are appropriately spent.

The GAO said in an April report that “limitations in sub-award data is a government-wide issue and not unique to U.S. funding to entities in China.”

GAO is currently examining the state of federal government-wide sub-award data as part of a separate review,” the report reads.

Peter Daszak, right, the president of the EcoHealth Alliance, is seen in Wuhan, China, on Feb. 3, 2021. (Hector Retamal/AFP via Getty Images)

The Eco-Health sub-awards to WIV illustrate the problem.

“Despite being required by law to make these receipts available to the public on the USAspending.gov website, EcoHealth tried to cover its tracks by intentionally not disclosing the amounts of taxpayer money being paid to WIV, which went unnoticed for years,” Ernst said in the statement.

“I was able to determine that more than $490 million of taxpayer money was paid to organizations in China [in] the last five years. That’s ten times more than GAO’s estimate! Over $870 million was paid to entities in Russia during the same period!

Together that adds up to more than $1.3 billion paid to our adversaries. But again, these numbers still do not represent the total dollar amounts paid to institutions in China or Russia since those numbers are not tracked and the information that is being collected is incomplete.”

Adam Andrzejewski, founder and chairman of OTB, told The Epoch Times, “When following the money at the state and local level, the real corruption exists in the subcontractor payments. At the federal level, the existing system doesn’t even track many of those recipients.

“Without better reporting, agencies and appropriators don’t truly understand how tax dollars were used. We now know that taxpayer dollars are traded further downstream than originally realized with third- and fourth-tier recipients. These transactions need scrutiny. Requiring recipients to account for where and how they actually spend each dollar creates a record far better than agencies are capable of generating.”

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Tyler Durden Fri, 06/02/2023 - 19:40

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Government

OraSure Technologies’ CFO Makes Bold Insider Purchase, Reigniting Investor Confidence

Executive Kenneth McGrath’s $500,000 buy read as promising signal about future for diagnostic test developer OraSure Technologies (NASDAQ:OSUR) saw…

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Executive Kenneth McGrath’s $500,000 buy read as promising signal about future for diagnostic test developer

OraSure Technologies (NASDAQ:OSUR) saw a stock price re-rate on Thursday, climbing 11% after investors became aware of its CFO Kenneth McGrath buying shares in the diagnostic test developer.  This latest rally in OSUR stock, gives traders and investors hope that the strong momentum from the beginning of 2023 might return.

OSUR shares had mounted an impressive 54% rally for 2023 through to May 10, when the first-quarter results update spooked investors. 

The CFO’s trade was initially spotted on Fintel’s Insider Trading Tracker following the filing with the Securities and Exchange Commission.

Big Holdings Boost

In the Form 4 filing, McGrath, who assumed CFO duties in August 2022, disclosed buying 100,000 shares on May 30 in the approved trading window that was open post results.

McGrath on average paid $4.93 per share, giving the total transaction a value just shy of $500,000 and boosted his total share count ownership to 285,512 shares.

The chart below from the insider trading and analysis report for OSUR shows the share price performance and profit made from company officers in previous transactions:

OraSure Technologies

Prior to joining OraSure, McGrath had an impressive eight-year tenure at Quest Diagnostics (NYSE:DGX), where he rose to the position of VP of Finance before departing. This is the first time that the CFO has bought stock in the company since August 2022. It is also worth noting that the purchase followed strong Q1 financial results, which exceeded Street forecasts.

Revenue Doubles

In its recently published Q1 update, OraSure Technologies told investors that it generated a whopping 129% increase in revenue to $155 million, surpassing analyst expectations of around $123 million. 

Notably, the revenue growth was driven primarily by the success of OraSure’s COVID-19 products, which accounted for $118.4 million in revenue for the quarter and grew 282% over the previous year.

The surge in revenue for this product was largely driven by the federal government’s school testing program, which led to record test volumes. However, it is important to note that demand for InteliSwab is expected to decline in Q2 2023, prompting OraSure to scale down its COVID-19 production operations. As part of its broader strategy to consolidate manufacturing, the company plans to close an overseas production facility.

While the COVID-19 products division has been instrumental in OraSure’s recent success, its core business delivered stable flat sales of $36.6 million during the quarter. 

In terms of net income, OraSure achieved an impressive result of $27.2 million, or $0.37 per share, in Q1, marking a significant improvement compared to the loss of $19.9 million, or a loss of $0.28 per share, in the same period last year. This result exceeded consensus forecasts of $0.16 per share. As of the end of the quarter, the company held $112.4 million in cash and cash equivalents.

Looking ahead to Q2, OraSure has provided revenue guidance in the range of $62 to $67 million, reflecting the lower order activity from the US government with $25 to $30 million expected sales for InteliSwab. The declining Covid related sales have been a core driver of the share price weakness in recent weeks.

While sales are likely to fall in the coming quarters, one positive for the company is its low debt balance during this period of rising cash rates. The chart below from Fintels financial metrics and ratios page for OSUR shows the cash flow performance of the business over the last five years.

OraSure Technologies

Analyst Opinions

Stephen’s analyst Jacob Johnson thinks that outside of Covid, OSUR continues to execute on several cost and partnership initiatives which he believes appears to be bearing fruit. Johnson pointed out that three partnerships were signed during the quarter.

The analyst thinks that the ex-Covid growth story will be the new focus for investors from now on. The brokerage maintained its ‘equal-weight’ recommendation and $6.50 target price on the stock, matching Fintel’s consensus target price, suggesting OSUR stock could rise a further 29% in the next 12 months. 

The post OraSure Technologies’ CFO Makes Bold Insider Purchase, Reigniting Investor Confidence appeared first on Fintel.

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