Macroeconomic Overview:
August retail sales data released last night exceeded market expectations, injecting confidence into the market and leading to a reduction in expectations of a recession.
The Federal Reserve will hold an interest rate decision meeting at 2 a.m. tomorrow, and Powell's press conference will be held at 2:30 a.m. Currently, CME data shows that the probability of a 50 basis point rate cut has risen to 66%, while the probability of a 25 basis point rate cut has dropped to 34%.
The recent statement by Fed spokesman Nick, if it is guidance from the Fed, may suggest that a 50 basis point rate cut is more likely.
I personally think that a 25 basis point rate cut is more likely this time, and the market's expectations for a recession will weaken. However, if the rate is cut by 50 basis points directly, it may cause market panic and cause funds to leave the market and wait and see, which is not good for the price trend of risky assets.
The process of interest rate cuts is long-term. Overall, market liquidity will gradually improve as interest rates are cut, but the positive impact on the capital market will generally only be apparent in the later stages of the interest rate cut cycle.
Especially when it is the first interest rate cut, a smaller cut can better alleviate market concerns and is conducive to the stability of the capital market. Therefore, I believe that this 25 basis point rate cut is relatively appropriate.
About ETF dynamics:
On September 17, the US BTC spot ETF had a net inflow of $186 million, while the ETH spot ETF had a net outflow of $15.11 million.
As of September 16, BTC holdings on exchanges have dropped significantly, falling back to mid-November 2018 levels. Since the beginning of this month, exchange reserves of BTC have decreased from approximately 2.62 million to 2.58 million, a decrease of nearly 38,000 in two weeks.
The annual trend shows that BTC exchange reserves have decreased by about 430,000 since the beginning of the year. Low reserve levels indicate that the market prefers long-term holding rather than short-term trading, further reducing market selling pressure.
According to Whale Alert's monitoring, USDC Treasury minted 50 million new USDC on the ETH chain at 3:49 pm today and transferred them to Coinbase, indicating that the demand for stablecoins continues to increase.
According to Lookonchain, ETH/BTC long investor James Fickel converted 11,584 ETH into 450 WBTC at a price of 0.03881 in the past 10 hours, worth approximately $27 million.
Currently, he still has a debt of 1,308.8 WBTC (about US$78.8 million) on Aave, and has lost more than 21,000 ETH, worth about US$49 million, due to long ETH/BTC.
On-chain data shows that the Mayer multiple has dropped from the peak of 1.82 in this bull run to 0.9.
Normally, the bottom of the large historical cycle is 0.7 or below.
If the Mayer Multiple drops to around 0.7, it could mean the market is approaching a major cycle bottom.
The market trend is strong, and the rise is related to the positive retail data released yesterday.
But from a broader perspective, the overall market supply is insufficient, there has been a lack of money-making effect in the past six months, the on-site funds are not active, and new funds are insufficient, resulting in weak demand and the currency price remains in an adjustment stage.
The Federal Reserve’s interest rate decision tomorrow morning will be an important macroeconomic uncertainty event, and short-term market conditions may be affected by fluctuations.
If the interest rate is cut by 25 basis points, it will be considered a positive, while a 50 basis point cut may become a short-term negative and requires special attention. In the short term, the price pressure is around $64,000, and the support is between $54,000 and $57,000.
ETH performed weakly, the exchange rate was facing a break, and there was a divergence at the daily level, showing the need for an oversold rebound.
In terms of altcoins, some projects such as SUI have taken the lead in rebounding from the bottom, while most altcoins are still building a bottom. They need to fully complete the bottom construction before they will have the opportunity to rise sharply in the future. Patience is the best ➕👗➩BNB0098
