This week, the cryptocurrency market shows a downward trend, with the market sentiment index dropping sharply from 59% last week to 27.81%, entering the bearish zone.
VX：TZ7971
The total market value of stablecoins continues to grow, but the growth rate has significantly weakened, showing a trend of USDT growth and USDC decline - a phenomenon that investors should pay close attention to: USDT's continuous weekly growth of over $1 billion in the past five weeks indicates that institutional funds, primarily from non-US users, are still increasing their market entry; the significant decline in USDC reflects that US investors have ended their recent FOMO sentiment and made risk-averse moves due to unsatisfactory recent macroeconomic data, a signal that needs continuous monitoring.
Market Driving Factors Analysis
Strong Economic Data Impact: Wednesday's ADP employment numbers and GDP data exceeded expectations, showing the US economy remains robust, which is unfavorable for the Federal Reserve's interest rate cut decision.
Federal Reserve's Hawkish Stance: Powell's hawkish remarks after the monetary policy meeting reduced the September rate cut expectation to 50% and abandoned the October rate cut expectation.
Persistent Inflation: June's core PCE price index remained at 2.58%, higher than the expected 2.7%, showing no downward trend and further affecting rate cut expectations.
Underwhelming Financial Reports: Coinbase's second-quarter financial report, released after Thursday's market close, did not meet market expectations, driving a decline in the crypto market.
Institutional Demand Support: ETH whales and listed companies continue to purchase ETH, stabilizing market prices and sentiment to some extent.
Easing Trade Relations: The US and China's decision to continue a 90-day tariff suspension, along with a tariff agreement with the EU, positively impacted market sentiment.
Next Week's Focus
Lack of Macroeconomic Data: No significant macroeconomic data will be released next week, with market focus shifting to institutional buying power.
Institutional Buying Power: Continued attention should be paid to BTC and ETH purchases by listed companies and ETFs, as weakened buying power could lead to market pullback.
Maintain Cautious Stance: Given the current market environment, caution should be exercised. Prepare for potential risk events. Currently, spot holdings can be confidently maintained, as short-term negative factors are mainly panic and profit-taking selling, with no fundamental changes.
Institutional capital flow will become the key support for market stability. Currently, ETH whales and listed companies' continued purchases provide a certain buffer, but if this trend weakens, it may trigger a larger-scale pullback. Especially when technical adjustments are needed, reduced institutional buying could accelerate downward pressure.
Prepare for medium to long-term holding while maintaining sufficient liquidity to cope with potential volatility. In the absence of major catalysts, the market may need more time to digest previous gains and build momentum for the next phase.
