Written by: Shang2046
The information, opinions and judgments on markets, projects, currencies, etc. mentioned in this report are for reference only and do not constitute any investment advice.
The capital inflow in July is reversing the decline of the past two months. Combined with the US interest rate cut and the election, BTC has once again entered a strong channel.
Market Week
BTC rebounded strongly for two consecutive weeks, returning to above $68,000, and finally recorded a weekly increase of 12.68%. Following the previous week, it once again created the largest increase in the past 20 weeks, reversing BTC's volatile downward trend.
This week, the short-term market fell back to the 7-day moving average, and multiple moving averages crossed to form a new upward channel. The 7-day moving average crossed the 14-week moving average, and the moving average began to turn upward. Since reaching a record high in March, the market has been fluctuating and adjusting for nearly 20 weeks. We expect the market to completely get rid of the shock box and return to $73,000 in the most optimistic month.
ETH rose 8.89%, weaker than BTC, SOL rose 24.94%, the Altseason Indicator index turned over the 30-day moving average, and many sectors began to strengthen.
In summary, the strong capital inflow in July reversed the decline in May and June, with the total capital inflow reaching US$3 billion in three weeks, 2.5 times the cumulative inflow of US$1.2 billion in the past two months. US ETFs also showed similar strong inflows.
Federal Reserve and economic data
In the past two weeks, the Federal Reserve has continued to be dovish, and various investment banks are optimistic about the September rate cut. Radicals believe that September may be cut by 50 basis points, or three rate cuts this year. This time the tone is the real turning point of the rate cut. All parties in the market began to take action to re-price various targets. The US dollar index fell to 103.65 this week. The price of gold fell slightly, falling back to $2,400.
In the US stock market, the previously strong Nasdaq and S&P 500 experienced a 3.65% and 0.71% correction respectively, while the Dow Jones rose slightly. After the expectations are settled, it is expected that the turbulence will continue for a while before entering a new trend.
Another unavoidable macro factor is the US election. After the shooting incident and Biden's voluntary withdrawal from the election, Republican presidential candidate Trump is getting closer to winning the November election. Trump, who is friendly to crypto assets, will attend the US Bitcoin Conference next week. The market is optimistic that the United States will further support the development of crypto assets in the next four years.
Funding
Continuing the trend of the previous week, the inflow of stablecoin channels accelerated, with an inflow of more than 1.594 billion US dollars for the whole week, the highest weekly inflow since May. USDT/USDC had inflows at the same frequency, 1.458 billion and 136 million respectively. USDT ended its sluggish state and inflowed in large quantities, becoming one of the driving forces for the price increase this week.
The ETF channel maintained net inflows for all five trading days of the week, with a total inflow of $814 million, which was lower than the $1 billion of the previous week but still high, which is not easy to achieve under the drastic adjustment of the Nasdaq. The two major channels had inflows of more than $2.4 billion for the whole week, which provided solid support for the rise of BTC and also showed that funds recognized the current price of BTC.
Chip Supply
As market liquidity recovered, long-term investors reduced their holdings by 17,800 coins, short-term investors reduced their holdings by 22,200 coins, and the exchange accumulated 34,600 new coins, a new high in the past month.
The profit margin of short-term investors in the entire market has returned to a positive value, but only 4% of them have made a profit. This may be related to the fact that BTC fell too quickly to 53,500, market confidence was severely hit, and the "bottom-fishing" behavior of short-term investors was very limited. According to the rules of the past chain, the selling pressure of short-term investors often appears when the profit margin exceeds 30%. Based on this calculation, $70,000 may generate short-term profit selling pressure.
This week, the BTC price has returned to above the miners' shutdown price. Miners still sold 9,800 coins, but the computing power continued to rebound and the weekly line continued to rise, showing strong confidence on the miners' side.
BTC on-chain data
Newly added addresses and activity rebounded slightly, hovering around the 30-day moving average; but Trasactions rebounded more positively, which means that the Bitcoin network application side is trying to restore its active status.
Ecological analysis
Crypto blue-chip assets as a whole continued to expand: Ethereum Eco is still in the recovery period, and transactions, new addresses, and active addresses have begun to rebound. Layer2 is the same. Solana's active addresses continue to expand, with new addresses hitting the third highest in history and active addresses hitting the second highest in history.
On July 18, the Hong Kong Monetary Authority announced the list of Hong Kong's stablecoin sandbox. Five companies, including JD.com's CoinChain Technology and Standard Chartered Bank Yuanbi, were approved to participate, which shows Hong Kong's determination to continue to promote the mainstream application scenarios of encrypted assets.
EMC BTC Cycle indicator
The EMC BTC Cycle Metrics indicator is 0.5, a bullish signal awaiting further recovery interruption.
