Although risk sentiment stabilized last week, G7 fixed income markets experienced a challenging week as several non-US headline economic data surprised to the upside. Australia's CPI rose 3.8% year-over-year, higher than the expected 3.6%, causing its 5-year government bond yield to jump by 15 basis points and the AUD to rise 2.5% against the USD for the month. This was followed by Canada’s employment report, which was exceptionally strong and far exceeded expectations (unemployment rate at 6.5%, expected 7.0%), triggering the largest single-day move (+20 basis points) in Canadian 5-year bonds since 2022 and sending the CAD soaring by 2%. In Japan, despite weak capital spending, markets are pricing in a 90% probability of a Bank of Japan rate hike this month, making the dovish Federal Reserve stand out among the G7.
The market widely expects the Federal Open Market Committee (FOMC) this week

Key Indicators (November 17, 4 PM HKT to December 1, 4 PM HKT)
$86,400(ETH/USD: -11.9% )$3,200

The crypto assets market suffered a heavy fall in early winter, with BTC dropping below $87,000, indicating overall weak risk appetite. Meanwhile, the U.S. stock market performed strongly, with the S&P 500 index rising by 3.7%. Holiday sales data was good, and the economic fundamentals remain robust. The next focus will be on the Fed meeting and related economic data to assess future policy direction.

After experiencing a sharp selling off last week, Crypto Assets are showing initial signs of stabilization. On Monday morning, prices rebounded from a low slightly above 80,000, trading close to 88,000. With Fed Chair Williams reigniting expectations for a rate cut in December, the market entered the Thanksgiving holiday week with some cautious optimism. A strong rebound in the stock market (S&P 500 +1.5%, Nasdaq +2.7%) and early rebalancing flows as the month-end approaches also helped boost risk sentiment.
Risk sentiment has broadly improved, and the open interest in BTC options has slightly turned positive, with the put/call ratio for options expiring at the end of the month around 0.67. A large number of put options have strike prices concentrated around 80,000, with a skew towards put options being aggressively bought, while call options are being heavily sold. The market undoubtedly feels better hedged against further declines, allowing it to enjoy a rebound above the support level of 82,000.