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It’s official—Donald Trump’s return to the White House has triggered a surge across markets, but nowhere is the reaction more explosive than in the crypto sphere. From Bitcoin’s record-breaking highs (briefly trading over $75,000) to Dogecoin’s rocket-fueled gains, Trump’s victory has injected fresh enthusiasm into digital assets.

The rally isn’t just a reflection of sentiment; it’s a validation of what we’ve been championing all along: that crypto and tech are the sectors to watch, unphased by the Fed’s cautious rate moves and now buoyed by an administration promising a more favorable regulatory landscape.

Trump’s win doesn’t just signal potential SEC shakeups but a broader shift toward deregulation and innovation. As the Fed navigates a delicate balancing act with rate cuts and the economy finds itself in the middle of an incoming fiscal whirlwind, tech and crypto are clearly positioned for continued growth.

With fiscal policy likely to play into our thesis of "long crypto, long tech," today’s gains mark only the beginning of what could be a massive movement in digital assets. This election outcome is a powerful endorsement of what we’ve believed all along: stay long on the future, and the future is digital.

Election & Fed Cut To Drive This Week’s Action

Synopsis:

Donald Trump’s re-election as the U.S. president in 2024 has ignited a significant market rally. His win, coupled with Republican control in the Senate and potential gains in the House, sparked massive moves across key financial sectors.

The Dow Jones surged over 1,300 points, the U.S. dollar strengthened significantly, and Bitcoin hit record highs, underscoring a sharp pivot to pro-risk assets. Traders are bracing for major policy shifts on tariffs, energy production, and deregulation, with particular impact on sectors like tech, energy, and banking.

The Details:

• Market Reaction: The Dow soared 1,300 points, while S&P 500 and Nasdaq futures gained 2.2% and 1.7%, respectively. Bitcoin jumped to record levels, driven by market optimism surrounding deregulation and economic stimulus expected under Trump’s second term​​.

• Dollar and Yields: The U.S. Dollar Index spiked by 1.4%, its largest jump since 2020, as traders anticipate increased fiscal spending and tariff pressures on China. Treasury yields rose, with the 10-year yield reaching 4.4%​​.

• Sector Performance: Tech and financials led gains, with Tesla shares up 12.9% due to the anticipated deregulatory stance. Defense stocks and fossil-fuel producers also surged, as Trump is expected to prioritize traditional energy policies and U.S. defense. However, companies with exposure to tariffs, like some auto manufacturers, showed mixed performance​.

• Senate and House: The GOP secured the Senate with flips in Ohio and West Virginia. The House remains too close to call, but a Republican majority could mean an easier path for Trump’s aggressive tax cuts and spending plans​.

• Global Ripple: Asian and European markets reacted mixedly; Asian equities saw gains in Japan but declines in China, driven by tariff concerns. The Mexican peso dropped 2.6% on fears of new tariffs, while commodities like crude oil and gold saw declines​​.

WHY IT MATTERS:

Trump’s re-election signals significant volatility and opportunities. Pro-growth, pro-U.S. policies are likely to boost domestic-focused small caps and energy stocks. However, higher tariffs could weigh on international stocks and U.S. companies with large export markets, setting up a risk/reward play for investors. The strong dollar might pressure multinational earnings, while deregulation in finance and tech could attract further capital into these sectors.

Key Highlights:

• Dow up 1,300 and S&P futures climb 2.2%.

• Bitcoin reaches record highs, signaling bullish sentiment around digital assets.

• U.S. Dollar Index up 1.4%, its largest gain since early 2020.

• Republicans control Senate; House remains uncertain but leaning Republican.

• Impact on trade: Expected 20% tariffs on Chinese imports; auto sector in focus for new tariffs on EU imports.

Trump’s presidency could mean a deregulatory bonanza for U.S. markets but poses risks for export-heavy and international sectors.

Zerohedge

Fed Remains Poised To Cut Interest Rates By 25 BPS Tomorrow

Synopsis:

The Federal Reserve is set to announce a 25-basis-point rate cut on November 7, following through on expectations to gradually lower rates while supporting economic stability.

This dovish move, occurring just after Donald Trump’s election victory, reflects the Fed's strategy to counter cooling inflation and moderate job growth. Trump’s win has buoyed markets, and his pro-growth, pro-business stance is expected to influence market sentiment and potentially shift the Fed’s approach in 2025.

The Details:

• Rate Cut Confirmation: The Fed will likely cut rates by 25 basis points, adding to the recent September cut, as inflation decelerates and employment conditions soften. Headline CPI rose by 2.4% YoY in September, while the Fed's preferred measure, PCE inflation, increased by just 2.2% YoY in August – both hitting multi-year lows and supporting further policy easing​​.Seeking Alpha

• Trump’s Victory Impact on Markets: Trump’s election win has driven optimism across equities and strengthened the dollar, with markets expecting favorable conditions under his administration. The anticipated tax cuts and spending policies could spur immediate growth, but the Fed remains cautious. Fed Chair Jerome Powell will likely reiterate a “data-dependent” approach, keeping future rate adjustments flexible amid evolving fiscal policies​​.

• Fed’s ‘Neutral’ Rate and Forward Guidance: The Fed is aiming to bring rates closer to a "neutral" level, likely around 3.5%, to support the economy without overstimulation. This gradual approach keeps room for more cuts if economic data signals continued cooling. The recent 2-year yield is expected to stabilize near 4%, while the 10-year yield holds at approximately 4.25%, reflecting strong investor confidence in the Fed’s measured easing approach​

• Broader Economic and Employment Signals: Nonfarm payroll growth surprised positively in September, increasing by 254,000 jobs, while unemployment edged down to 4.1%. This trend has reassured markets of a “soft landing” scenario, where the Fed’s cuts manage to boost the economy without overheating it. Yet, temporary impacts from factors like hurricanes may have distorted labor data slightly, requiring the Fed to stay nimble​.

WHY IT MATTERS:

Trump’s win introduces fiscal policies that could alter the economic landscape, particularly if his agenda spurs rapid spending and lower taxes. For traders, this means opportunities in growth-sensitive sectors and potential volatility in the bond markets.

The Fed’s commitment to easing at a steady pace could offset market fears of sudden tightening, especially if inflation stabilizes further. Investors should watch Powell’s press conference for cues on how the Fed might balance Trump’s anticipated economic stimulus with its goal of sustainable growth.

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The BRRR is meant for informational purposes only. It is not investment advice. Please consult with your investment, tax, or legal advisor before making any investment decisions.ll