Good morning, Asia. Here's what's making news in the market:
Early Tuesday morning Hong Kong time, Bitcoin was trading around $114,000 and Ethereum was trading around $4,120, as markets enter one of the most important weeks of the year defined by U.S.-China diplomacy, Federal Reserve policy pivots, and a congested schedule of Big Tech earnings.
Polymarket traders are betting big on a breakthrough, pricing in a 92% chance that the US and China will sign a tariff deal by November 10, following constructive talks in Malaysia over the weekend.
The framework, which could be finalized when Donald Trump meets Xi Jinping at the APEC summit in Seoul on Thursday, helped boost risk appetite in both stocks and cryptocurrencies. Bitcoin briefly reached $116,200 on Sunday, but has since fallen slightly, while AI-related stocks such as Miner, Hut8, CleanSpark, and IREN are up 2% to 3%.
Still, not all signs point to a sustained détente. Another Polymarket deal gives Beijing only a 36% chance of lifting its ban on rare earth exports by the end of the year, suggesting investors expect there to be tactical cooperation on tariffs but continued competition for strategic resources.
The divergence between these two probabilities supports the market's belief that Thursday's summit will result in a political victory rather than a structural reset.
Singapore-based QCP Capital said in its latest market note that the outcome of President Trump and the Xi Jinping administration “could shape the near-term path of cryptocurrencies more than Wednesday’s Fed interest rate decision.” The firm highlighted speculation that the Fed may soon end its three-year quantitative tightening program, a shift that would inject liquidity into the market and support risk assets.
“Sooner or later, if signs emerge, liquidity expectations will be anchored again,” QCP wrote.
For now, Bitcoin remains flat for the month, putting October's seven-year positive streak known as the “Uptober” in jeopardy.
The prolonged U.S. government shutdown, now in its 26th day, has clouded the Fed's outlook by restricting the flow of economic data while investors wait for earnings reports from Microsoft, Apple, Amazon, Meta and Google for clues about consumer resilience, QCP argued in a note.
Derivatives data shows that BTC and ETH risk reversals have turned neutral after weeks of defensiveness, indicating that traders are less afraid of short-term declines.
However, as QCP warned, a clean bullish resumption is unlikely until BTC recovers $116,000 at the end of the month. As politics, policy, and liquidity converge, cryptocurrencies are set for a volatile week where the “Uptober” winning streak could extend further or ultimately come to an end.
market movements
Bitcoin: Bitcoin briefly rose to $116,200 over the weekend, but has since fallen to $114,000, consolidating near cycle highs as traders wait for clarity from the Trump-Xi summit and the Federal Reserve.
Ethereum: Ethereum has stabilized around $4,120, reflecting Bitcoin’s strength as investors consider macro catalysts and await fresh liquidity confirmation from the Fed.
gold: Gold rebounded slightly to $4,021 an ounce after falling below $4,000 an ounce on Monday as optimism over U.S.-China trade talks and rising U.S. Treasury yields dampened demand for the haven asset.
Nikkei 225: Asian stocks fell on Tuesday, with Japan's Nikkei 225 down 0.38% and the TOPIX 0.49%, as investors awaited the first meeting between US President Donald Trump and Japan's new Prime Minister Sanae Takaichi.
