📢 March Signals 📢

🗒️ Market update

March 2026: Bear market progress with a macro crosscurrent

The past 30 days have been defined by heightened macro uncertainty, geopolitical tension, and continued pressure across risk assets. Encouragingly, the crypto relief rally we discussed as a probable outcome last month did materialise, and we have seen outperformance vs gold and equities while WTI spiked above $100 a barrel and looks to test that zone again.

The sharp move higher in energy prices is also flashing a more familiar macro warning. As the chart below highlights, when oil prices deviate materially above trend, the probability of recession has historically risen sharply. We are now approaching those levels once again. Higher energy costs act as a tax on both consumers and businesses, tightening financial conditions at a time when liquidity is already constrained.

Layered on top of this, a new structural force is emerging, AI-driven efficiency gains are increasingly translating into real job losses, with recent announcements across both government and private sectors, Meta, Amazon, Block, Atlassian, Morgan Stanley all recently in the headlines cutting staff, blaming AI and seeing a share price bump. The combination of cyclical pressure (energy-driven slowdown) and structural disruption (AI-related labour displacement) creates a challenging near-term backdrop, but also strengthens the case for the policy response. Historically, when growth slows and unemployment rises, the outcome is consistent: monetary conditions ease, liquidity returns, and risk assets find support.

Crypto Market Resilience: Quiet Strength Beneath the Surface

Despite the challenging backdrop, crypto markets have shown notable resilience. Bitcoin looks set to break its 5 consecutive months downtrend, hold key support levels established earlier in the year.

Importantly, during the recent escalation in geopolitical tensions, Bitcoin did not break below its prior lows. This type of relative strength in the face of negative news flow is often characteristic of late-stage drawdowns.

At the same time, institutional adoption continues to build:

• Spot ETF inflows remain structurally positive, a run on 7 positve inflow days for BTC with cumulative allocations still modest relative to market cap.

• MSTR has re-commenced buying at scale, with the STRC product (a preferred with 11.5% yield) capturing mindshare and flows. MSTR bought over 43,000 BTC (~$3bn) so far in March.

• Regulatory clarity, the SEC has formally classified SOL as a digital commodity in its new crypto asset taxonomy, alongside BTC, ETH,  and 14 other assets.

Bear Market Progress

Zooming out, Bitcoin has bounced of its 200-week moving average, a level that has historically marked periods of maximum pessimism and long-term opportunity. This isn’t about precise timing, but about context: across prior cycles, price interacting with this trend has consistently coincided with accumulation phases. It is the type of level where a serious value investor begins to lean in, when sentiment is weak, liquidity is constrained, and the broader market is focused on downside risks. We are now clearly in an accumulation zone, the bottom may or may not be in but we are in value territory.

We are not convinced a sustained break below this level is required this cycle, although a retest remains more likely. The previous bear market did spend extended time below this trend; however, that period was driven by extraordinary events, namely the collapse of 3 Arrows Capital and the fraud surrounding FTX, which are unlikely to be repeated at the same magnitude this cycle.

We are also testing levels similar to the 2022 bear market, specifically the prior cycle high, and doing so on a roughly five-year (60-month) interval. While some may debate the use of the first peak in the 2021 cycle tops, from both a technical and on-chain perspective it represented the stronger top. The second peak reached a higher price, but failed to confirm across key strength metrics.

Probabilistically, we are likely closer to the end of the bear market than the beginning. The lows may already be in; a retest is our base case; a new low remains possible but is not our central view. While the four-year cycle points to consolidation through to October, structural demand from ETFs and corporate buyers continues to build. As a result, this drawdown is shaping up to be shorter and shallower than those of the past.

If you’d like to learn more about the MTC Digital Asset Fund or the MTC Bitcoin and Gold Fund, reach out to myself or the team. The asymmetric opportunity gets stronger every day.

🗓️ Key dates to watch

• 3 Mar – ISM PMI
• 6 Mar – Non farm payrolls
• 11 Mar – Inflation data
• 18 Mar  – FOMC meets

💡Why We Exist – Giving You Confidence in Crypto

Accessing digital assets is hard. From self-custody risks to tax complexity and misinformation, the hurdles are high. That’s why we built an actively managed unit trust to help investors confidently access the most promising digital assets — the ones we believe will underpin the future of the financial internet over the next 5–10 years.

Our investors gain exposure to a diversified portfolio of high-quality crypto assets — without needing to manage wallets, exchanges, or tax chaos. We aim to simplify the experience, reduce risk, maximise potential yield, and bring institutional-grade risk management to every investor.

🧠 SMART 

• Actively managed portfolio, aiming to enhance risk-adjusted returns
• Disciplined asset selection, with a long-term, buy-and-hold bias
• Yield from staking to help offset fees
• Simple access — no wallets, passwords, or crypto admin required

🔒 SECURE 

• Institutional-grade custody with Coinbase Custody
• Staking conducted in insured cold storage
• Comprehensive counterparty due diligence
• Assets remain fully segregated and secure

 🪙 CRYPTO 

• Blockchain removes intermediaries, reducing cost and improving efficiency
• Transparent and borderless financial infrastructure
• Unlocking new use cases in payments, identity, infrastructure and beyond

📩 Interested in learning more? Visit www.merkle.com.au or reply to this email to book a call.