For anyone who follows me you will know I like to look at the wider market view.

I will first show the more macro trend/sentiment and then what could be effecting the crypto price.

Yesterday’s CPI print and Todays “recession " risk readings have all been pro crypto and pro stocks.

These readings have made a 25bps cut the more likely outcome in September but over the last weeks the market has been gripped by recession or crash fears, todays readings point more to a soft landing (for now)

Most indexes have reacted to this as good news being good news, a sign of economic stability.

The DXY(dollar strength) climbed off a higher likelyhood of a 25bps(not 50+) Septemeber cut, higher interest rates makes the dollar more competitive vs its (DXY) rivals, especially Japan (carry trade).

The S&P500, Nasdaq, Nikkei, Rus2000(Small caps) all gained off these readings.

Gold price saw a sell off which is likely due to the readings over the last 2 days(especially today) pointing to a stronger economy and less need to hold safe haven, non yield bearing, Gold.

So why is crypto stalling ?

Crypto has had a slight recovery off todays news but over the last 2 days it is still down while other indexes have reacted to the macro data in a more positive way.

$BTC News based price movement over the last day 👇

Crypto is obviously in its own category so we can’t just compare it to the stock markets or Gold, i use these as comparisons as it shows wider market sentiment.

Most importantly crypto is more "risk on" than global stocks, I feel that the tensions in the Middle East will still weigh heavily on Crypto price while the situation remains tense.

Another factor is the news of the US Government moving BTC.

I have pointing this out in my previous posts but to refresh, Trump said at the BTC conference that he would not sell seized government BTC.

I also pointed out that this means the current US Gov could just sell the BTC they hold if it was likely Trump would be elected, Trumps comment at the BTC conference seemed like a dare or a challenge to see how the current government would react, the same political game he played by telling Powell not to lower rates.

If the current US administration sell the BTC then Trump will use that as firepower to gain the "crypto vote" , if they hold the BTC then Trump will say it was by his doing, because he told them to.

Important to note

The Bitcoin moved by the US Gov was moved to a Coinbase account.

In 2019 Coinbase purchased the custody arm of Xapo Bank.

Coinbase are the largest custodian of BTC in the world, they hold Bitcoin for many of the large Bitcoin ETF funds and other large clients.

These Bitcoin (keys) are held across the world in off grid, military grade, bomb proof bunkers and includes a vast array of other security measures, Billions have been spent on securing Bitcoin for large holders.

I am including these facts because the US Gov might not intend to sell the BTC they have moved, it could simply be that they are moving them to cold storage with Coinbase custody.

I do feel that if Trump is likely to win or wins the election then the current administration might dump their BTC holdings, for now it would serve little purpose to do so as the election is still close and the "crypto vote" matters to much.

These Bitcoin moves will be used as a Political game in the coming months and create more uncertainty in the market.

The liquidity/open interest in the Bitcoin market is low at the moment so the threat of this sell pressure (Us Gov, final Mt.Gox payments) and also tensions in the Middle East are holding back BTC price movement.

Final thoughts,

The readings over the last 2 days have given the market a sigh of relief when it comes to recession fears (for now), now large holders will start to price in higher interest rates again.

The global market is not stable by any means, these readings just give a short term pause to these worries, the market will still be uncertain as it now goes back to pricing in higher interest rates over recession fears, this can all change quickly with future readings, it is a temporary shift in focus.

The US data (in a vaccum) from the last 2 days should have a mildly bullish effect on Crypto, that being said any news or increased tensions in the Middle East or Gov/Mt.Gox sell pressure will hold far more weight (short term) for Bitcoin and crypto as volume and open interest is low.

From now until next week Wednesday (21st Augusts, FOMC minutes) there is pretty clear sailing in regards to economic data.

Keep and eye on the news.

Trade safely.

Peace.

#BecomeCreator #TheWolfThatWins #Market_Update #MarketDownturn