Morning Comment: Summer Doldrums And Volatile Bitcoin

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"Summer doldrums" are very unlikely this week

You’d think that the last few days of July and the first days of August would be prime-time for the “summer doldrums,” but it has the potential to be one of the most active and volatile points of the year. First of all, we get another round of earnings from dozens of companies. Second, the renewed U.S.-China trade talks will begin. Third, we have the Fed’s rate-decision and press conference on Wednesday.

Bitcoin is down 25% and is now testing key support

That said, we won’t get much (if any) news on any of these issues today, so it should be a quiet/uneventful day in the stock and fixed income markets. This gives us an opportunity to reiterate the comments we made about Bitcoin over the weekend when we said it stands at an critical technical juncture. It is down another 4% this morning, which means it’s now down more than 25% over just the past month. Of course, it rallied 66% in June, so there's no question that Bitcoin is wildly volatile (for a long time). However, any further downside follow-through over the coming days and weeks will be quite negative.

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