The financial storm has entered a stable phase; can the macr...

The financial storm has entered a stable phase; can the macro side provide better stabilizing factors?

Main narrative: Government shutdown. The situation remains in an optimistic phase!

In the early hours, Trump indicated communication with the House to seek the fastest possibility of ending the government shutdown. The House will convene at 10 a.m. on February 3rd, US time, to vote on the remaining fiscal bills. In Beijing time, it will be 11:00 p.m. on February 3rd.

Trump stated that once the House passes the bill, he will sign it into effect as quickly as possible to restore government operations. However, although the Republicans hold a majority in the House, they are not completely unified, meaning there is still a small chance of voting failure. Republican leaders in the House are actively communicating with members to ensure the bill passes with the maximum number of votes.

Once the government resumes operations, a risk factor on the macro level will be reduced, and the market will gradually turn optimistic.

One of the auxiliary lines: The financial storm has temporarily eased.

Gold prices rose, the dollar stabilized, and the bond market remained steady. Yesterday’s manufacturing data temporarily boosted confidence in the U.S. economy, bringing some stability back to financial markets. At this stage, financial markets are undergoing 'repair,' with short-term risk appetite remaining low, but this added stability is a positive development.

The second auxiliary line: The largest tax filing season in the U.S. continues.

On January 26th, the U.S. launched its largest tax filing season, which will indirectly increase liquidity to some extent. This increased liquidity will last through February to March, winding down in April, with a brief liquidity withdrawal phase due to tax payments occurring from April to the end of April. At this stage, liquidity is being supplemented but not significantly so, unlike direct fiscal stimulus measures.

The third auxiliary line: U.S. economic data.

This week's important non-farm payroll data was postponed due to the government shutdown. Once the government resumes operations, the release of the data will be rescheduled. If the government resumes on Tuesday, U.S. time, the data could be released as early as this week or next week.

Without the influence of employment data, the market has reduced its reliance on employment as a way to forecast the future interest rate path. Therefore, whether there will be a rate cut in the short term this week is unlikely to be the main theme, which should help the market recover.

The fourth auxiliary line is Middle Eastern geopolitical risk.

It has been tentatively confirmed that the US envoy and the Iranian prime minister will meet in Istanbul this Friday to push forward the nuclear agreement. Although expectations for a successful negotiation are low, this signal has weakened short-term geopolitical risks in the Middle East.

At the same time, there are rumors that the USS Lincoln aircraft carrier will withdraw from the Middle East, but the news has not been confirmed, and the risks still need to be closely watched.

What we need to be cautious about is whether Trump, if talks with Iran fail over the weekend, might pretend to show weakness by feigning a withdrawal only to suddenly take action. While the likelihood of direct action at present seems slim, this weekend through next week still requires vigilance.

Overall Summary:

The financial markets are currently in a recovery phase. Positive news can accelerate this recovery. The market needs more patience now, carefully observing whether any macro headwinds may emerge while waiting patiently for the market to heal, confidence to return, and risk appetite to increase, which would boost rebounds in tech stocks and BTC.