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Asia Colour

Asia Colour

QCP CapitalQCP Capital2024/10/01 02:03
By:Elisha

As Q3 concludes, both equities and Bitcoin have outperformed their expectations, defying their usual September downturn:

– The SP 500 is up 5.1% for the quarter, marking its best year-to-date performance since 1997.

– Bitcoin has surged over 7% this month, on track for one of its strongest September performance on record.

– Global risk-on sentiment remains strong as we enter Uptober, with China’s CSI 300 Index jumping by 9% today after introducing its largest property support package in years. Goldman Sachs’ prime brokerage desk shows hedge funds positioning with three times as many bets on rising IT stocks compared to falling ones.

Crypto market Outlook

This equity-led rally may be tested when Q3 earnings kick off in mid-October as traders reassess the current lofty valuations. We expect Bitcoin to benefit from any equity retracement due to its nature as a risk-on asset amidst global monetary easing.

Trade Idea

BTC may continue to trade within its current range, as historically, significant profit-taking transactions have occurred at these levels. However, we maintain a positive medium-term outlook. A breakout above 70k could trigger further upside momentum.

Weekly Range Accrual + Topside Convexity

  • Receive weekly 5% p.a. coupon if fixes between 62k 70k 
  • If spot breaks above range and fixes just below 76k at expiry, you get an additional payout up to 35.3% p.a.

Range Accrual Component

  • Maturity: 27DEC24
  • Coupon Frequency: Weekly from 11OCT24
  • Coupon Rate: 5% p.a. in USD if BTC/USD fixes at-or-within Coupon Range, 0% pa otherwise
  • Coupon Range: 62,000 to 70,000 BTC/USD

ERKO Component

  • Maturity: 27DEC24
  • Strike: 70,000 BTC/USD
  • Barrier: 76,000 BTC/USD
  • Max Potential Payout: 35.3% p.a.

Spot Ref: 63,300

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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