Morale is improving
With a promising crypto-specific event calendar ahead and BTC trading at a deep relative value compared to other assets, we favor full allocation in BTC, expecting a strong month ahead.
Preview
2026 has started strongly, with BTC up 8% over the past week amid robust ETF inflows, setting a positive tone for the year. BTC ETFs saw net inflows of 12,318 BTC last week, including the strongest daily inflow since October, which may support continued ETF absorption through January. Strength has broadened across the sector after a stagnant December, with ETH gaining 10% over the same period. This rebound follows a very quiet holiday season marked by multi-year low BTC volatility and depressed trading volumes.Despite the recent price strength, overall market activity remains subdued, with spot volumes, volatility, and derivatives leverage still near pre-December 2025 lows. Sentiment is improving but remains cautious. Attention now turns to a labor-heavy week of U.S. data that could influence rate expectations, even as markets price an 83.9% probability of unchanged rates at the January 28 FOMC.
