US exceptionalism thrives while crypto bleeds.

Transcript

Tom It's Monday morning in London, and if you blinked over the weekend, you missed the dollar hitting a fifty-two-week high while Bitcoin slipped below sixty grand again. Stick around — we've got the divergence trade of the summer.

Marie Good morning from Investment Flash, London Edition, the date is June twenty-ninth, twenty twenty-six. I'm Marie, with Tom and Gerald. Yesterday's weekend call to sell the Bitcoin Trust? Looking prescient.

Tom Right? Gerald, I'll give you that one — your short is up four percent just this morning. I'm not even mad.

Gerald I don't gloat, Tom, but when crypto bleeds, the value guys eat. But seriously, the takeaway today is US exceptionalism is alive and kicking. The S&P 500 ETF is just four percent off its highs, and the dollar bull ETF is at a fifty-two-week peak.

Tom That's what I'm talking about! Forget the 'sell America' calls. Foreign money keeps pouring in. SPY up, UUP at a high — it's a safety trade and a growth trade rolled into one.

Marie Hold on, Tom — I mean, yes, inflows are strong, but this is a defensive flow, not a risk-on flood. It's the dollar smile theory: money flows to the US when the world is scared and when the US economy is outperforming. Right now it's both.

Tom Exactly! That's the point. Dollar smile means up regardless. I'll take it.

Marie Exactly — that's literally the smile in action. Spot on.

Gerald One hundred percent. The framework's holding.

Gerald But the smile can flip fast if data turns. Jobs report this week could do that. Still, for now, trend is your friend.

Tom Trend's your friend — I'm tattooing that on my screen.

Marie Ha! Please don't. Alright, let's talk crypto because, Tom, you've been quiet on that front.

Tom I'm not even sure 'buy the dip' still applies — my portfolio's a crime scene right now.

Gerald Bitcoin below sixty grand — that's a buying opportunity, said every crypto bro for the last six months.

Tom Hey, I resemble that remark.

Marie Alright, but two quarterly losses in a row is no joke. Bitcoin down twelve percent in Q2 after twenty-two percent in Q1. That's a proper rout.

Gerald And Strategy — that's the bitcoin treasury company, ticker M-S-T-R — is down forty-seven point six percent year to date, trading eighty-two percent below its high. Leverage giveth, leverage taketh away.

Tom Oof. Over a billion in ETF outflows this month. Crypto winter two-point-oh is here.

Marie This is exactly what I mean about crowded trades. Crypto was consensus two years ago, and now it's unwinding. Meanwhile, the dollar trade is getting just as crowded — Wall Street banks are capitulating on euro longs.

Gerald Right, the Bloomberg piece is clear: banks are pricing in US rates outpacing Europe for the rest of the year. The Europe ETF is up only three point four percent year to date, and the euro is near multi-year lows.

Tom So short the euro, short Europe? I'm in. Trends are strong.

Marie Tom — Tom. That's exactly when you get squeezed. When everyone is on the same side, a dovish Fed whisper could tank the dollar. Remember that euro short squeeze that ripped three percent in a day?

Tom Fair, fair. But I'm not betting against momentum yet.

Gerald Ah, calling the bottom on the euro — that's six bottoms this cycle. I've lost count.

Marie Ha — okay, fair. But Gerald, you know rate divergence could widen if the ECB cuts and the Fed holds. That's your story.

Gerald It's the base case. But I'm watching data. Tom, you were eyeing China earlier? The PBOC just set its overnight rate lower than forecasts. Easing.

Tom Exactly! Chinese stocks are beaten down — FXI down twenty point seven percent year to date, near its fifty-two-week low. Contrarian entry if easing flows through. Plus, CNBC reports US data centers still rely on China for thirty percent of AI imports.

Marie Wait — nine of the top ten AI supply chain stocks in the CSI 300 have doubled in twelve months? That's incredible, but it's a stock-picking story, not a basket trade. FXI is heavy on state banks.

Tom Sure, but easing could buoy the whole market. The China Bond ETF would rally on lower rates straight away.

Gerald Trade war escalation could swamp any easing. I'd rather stay away. But I do like this other piece: Japan's launching eight infrastructure projects for a digital corridor — undersea cables, satellites. NEC and NTT are direct beneficiaries.

Tom I saw that! NEC and NTT — solid names. Government-backed demand for years. Multi-year tailwind.

Marie Absolutely. The digital corridor is a real initiative, and the optical network fund aligns perfectly.

Gerald Yeah, the coordination with allies adds a security dimension. Spot on.

Marie But there's a cautionary note: Japan's top banks are struggling to secure dollar funding for tariff deal projects. That could pressure Mitsubishi UFJ and Mizuho. So watch those tickers.

Gerald And if they scramble for dollars, that could push USD-JPY higher, but the BOJ might intervene. Messy.

Tom Alright, banks are a watch item. What about India? The rupee leading Asian gains, crude falling, capital flows. INDA down nine point two percent year to date, could rebound.

Gerald I'm skeptical of an Indian recovery amid global risk-off, but the macro tailwinds are there. I'd call it a contested buy.

Marie Philippines is the opposite: growth targets cut, peso weakness extended beyond the president's term. EPHE down only three point five percent, but further downside likely.

Tom So sell Philippines, buy India? That's a pair trade I can get behind.

Gerald Until the next risk-off wave hits and both fall.

Marie Wait — not so fast. The growth downgrade in the Philippines is partly due to Middle East tensions and El Niño. If oil spikes again, India's crude windfall disappears. Both have risks.

Tom Fair, but oil's been falling, not spiking. The Hormuz premium is fading.

Gerald Alright. Let's talk analyst favorites. Tom, brighten my day with some buy calls.

Tom Absolutely. Credo Technology — BofA raised target to three hundred forty bucks. The stock fell eleven percent last session, so better entry. Meta — Evercore reiterated buy with nine hundred thirty target. Pinterest — ten straight quarters of user growth, AI ads improving.

Gerald Credo down eleven percent and then they raise the target? Classic analyst move: price target after the fact. It's basically a free retirement plan.

Tom Ha! Okay, that's brutal. But you're not wrong.

Marie That's — yeah, that's fair. But the Meta call is interesting: subscription revenue diversification and AI monetization. That could re-rate the stock.

Tom Meta down fifteen point four percent year to date — that's a buy for me. Pinterest down twenty-one point six percent, but user growth is robust. AI-powered ad improvements could boost revenue.

Gerald I worry about ad spending in a slowdown, but the AI angle is real. Still, the autonomous driving story caught my eye: that UK startup Wayve is challenging Tesla and Waymo. Marie, you read that?

Marie Yes! Wayve is positioning as a tech partner to automakers, directly threatening Tesla's autonomous narrative and Alphabet's Waymo. That's a structural headwind that isn't priced in.

Tom Wait — a UK startup? That's a long shot. Tesla's ADAS is deployed at scale. Competition is years away.

Marie But if Wayve partners with Toyota or Volkswagen, that could erode market share. TSLA down thirteen point three percent year to date already, but this adds a new risk dimension.

Tom Alphabet's Waymo is the leader, and GOOGL is up seven point one percent. I think it's overblown.

Gerald Agree to disagree. But speaking of structural shifts, the FT piece argues robots, not chatbots, will realise AI's potential. That's the most original take today.

Marie Exactly! Industrial robotics on factory floors, automating physical tasks — that's where AI can boost productivity in the real economy. The robotics ETF, ROBO, is up sixteen percent year to date.

Tom I'm in! Robots are the next frontier. ROBO just nine percent below its fifty-two-week high, momentum building. That's a buy.

Gerald I like the thesis, but valuations might be stretched. The ETF has run up.

Marie No, but that's exactly my point — it's a long-term structural shift. Factory automation is the real productivity gain. Chatbots are toys compared to that.

Tom Exactly. One hundred percent.

Gerald Alright, fair enough. I'll concede that one.

Marie But back to our view: today's signals paint a picture of US asset dominance, dollar strength, and crypto pain. The dollar-smile dynamics are back — strong in both risk-off and US exceptionalism.

Gerald So the cleanest second-order trade is owning the dollar against a basket of weak currencies: euro, Philippine peso, maybe bitcoin. But be ready to fade crowded positions when macro surprises come.

Tom And that surprise could be this week's jobs report. A weak payrolls print flips the dollar narrative instantly. Until then, momentum rules.

Marie Right — and the press is silent on whether the BOJ might ease dollar funding for Japanese banks, which could influence the yen and global liquidity. Keep an eye on that.

Tom Agreed. Bottom line: buy dollars, sell weak EM and crypto, but be nimble. As always, none of this is investment advice. We're just talking trades.

Gerald Exactly. If you're just finding us, hit follow on Spotify, or check investmentflash.com for the full digest with charts and sources.

Marie We're back at nine a.m. New York time with the New York Edition. Until then, happy trading.

Tom See you then, buddies.