As January 2024 approaches, the market generally expects the Fed to maintain the current interest rate level. According to the latest data from CME's "Fed Watch", the probability of the Fed maintaining interest rates unchanged in January is as high as 91.4%. This means that unless there are unexpected economic data or financial crises, the Fed will most likely choose to keep the existing monetary policy stable. Although the probability of a rate cut is 8.6%, the possibility of a rate cut is small based on the current economic environment.
From the perspective of the crypto market, the Fed's decision to keep interest rates unchanged has brought positive signals to the cryptocurrency market. First, the unchanged interest rate means that the US dollar will not appreciate significantly in the short term, thus avoiding the suppression of crypto asset prices. Secondly, the market expects that the Fed will not rush to cut interest rates, which provides a certain degree of stability to the market. Especially for mainstream cryptocurrencies such as Bitcoin and Ethereum, a stable macroeconomic environment is undoubtedly a catalyst for the market recovery.
According to BlackRock's Bitcoin holdings data, their holdings have surpassed 550,000 BTC, reaching a market value of over $56 billion. As one of the largest asset management companies in the world, BlackRock's layout in the crypto market undoubtedly increases market trust in cryptocurrencies. BlackRock's investment behavior signifies that institutional funds are continuously flowing into the crypto market, providing support for Bitcoin's price. BlackRock's investment not only shows institutional optimism towards crypto assets in the long term but also indicates that global investors' confidence in Bitcoin and other digital assets is gradually recovering.
Meanwhile, Bitcoin mining company Hut 8's recent purchasing actions have also brought positive signals to the market. Hut 8 purchased 990 Bitcoins at an average price of $101,710, bringing its total holdings to 10,096 Bitcoins, with a market value exceeding $1 billion. Hut 8 has surpassed Tesla to become the fourth publicly listed company holding over 10,000 Bitcoins. This move not only indicates the mining company's optimistic expectations for Bitcoin's future price but also highlights the importance of digital assets as a reserve by enterprises.
Interestingly, Hut 8 also announced plans to raise $500 million through a newly issued stock program, part of which will be used to purchase Bitcoin and other digital assets in the open market. This move undoubtedly further solidifies Bitcoin's position as a value reserve asset. The continuous increase in holdings by mining companies and the active entrance of institutions have led to a sustained increase in market demand for Bitcoin, and it is expected that Bitcoin's price will steadily rise in the near future.
In contrast, the Trump family's crypto project WLFI. According to monitoring data, the WLFI team currently holds 15,597 ETH, with a total value of approximately $53.46 million, of which 8,827 ETH purchased (valued at about $32.47 million) has incurred an unrealized loss of approximately $2.1 million. Although WLFI's investment has incurred losses, this investment action indicates that cryptocurrencies are not just the battlefield for large institutions like Bitcoin and Ethereum; individual investors and family offices are also accelerating their entry into this market. Although unrealized losses may cause panic among some investors, in the long run, the potential value of cryptocurrencies remains promising.
The U.S. spot Ethereum ETF saw a net outflow of 16,700 ETH yesterday, valued at $60.5 million.
The U.S. spot Bitcoin ETF had a net outflow of 6,707 BTC yesterday, valued at $672 million.
BTC: Yesterday, Bitcoin closed with a 'small bearish candle', indicating weak market sentiment, accompanied by a net outflow of $672 million in spot ETF funds, leading to increased market panic.
In summary, even if an oversold rebound occurs in the short term, it will be difficult for the price to return above the 5-day moving average, as there is heavy selling pressure above. If the bulls fail to effectively stabilize above the 30-day moving average, further fluctuations may occur, testing the positions of the 60-day and 120-day moving averages.
ETH: Yesterday, Ethereum closed with a 'large bearish candle', having fallen below the 30-day moving average. While there is a short-term demand for a rebound from the oversold condition, there is still a possibility of further testing the 60-day and 120-day moving averages. Patience is required for adjustments, as there may still be opportunities to recover the upward trend in the future.
Altcoins: The current market sentiment is not very good, especially in the altcoin market. Due to Bitcoin's continuous downtrend, the overall market capital has slightly shrunk, and trading activity has decreased, with people generally preferring to avoid risks. Many altcoins have already dropped back to the bottom fluctuation zone, making it difficult for significant volatility in the short term. This indicates that now is not a good time for speculation; we need to wait for the market capital sentiment to recover before a new upward trend can begin. So, do not be impatient, patiently wait; the big altcoin market has not yet arrived, and the market capital will gradually warm up in the future.
Today's Fear and Greed Index: 74 (Greed)
