The information, opinions, and judgments regarding the market, projects, cryptocurrencies, etc., mentioned in this report are for reference only and do not constitute any investment advice.
As a psychological barrier, the resistance effect at $100,000 depends on the strength of the holders' collective will. This week's trend indicates that once the major trend of funds and sentiment is formed, breaking through the psychological barrier is only a matter of time.
After four consecutive weeks of gains, BTC fluctuated this week, opening at $101,400, then dipping to close at $104,447.76. After clearing out eager profit-takers and retesting the 5-week moving average, it gradually moved upward and ultimately surged above $104,000 on Sunday.
This week, the U.S. released CPI and PPI data, which met expectations, slightly skewed negative, but the adjusted crypto market seems to have entered a 'zero-risk' gradual upward phase under continuous inflow of funds.
Macroeconomic and financial data
This week, the U.S. reported that the seasonally adjusted CPI for the end of November recorded a year-on-year increase of 2.7%, rising for the second consecutive month, with a month-on-month increase of 0.3%, the largest increase since April.
After the CPI data was released, swap traders increased their bets on the Federal Reserve cutting rates before the end of 2025. They expect a cumulative rate cut of 87 basis points by then, which means a 25 basis point cut next week, and approximately two more cuts in 2025, each by 25 basis points. This level of rate cuts is one less than the four cuts proposed in the latest quarterly dot plot from September.
In the U.S. stock market, mixed results were observed. The Nasdaq rose by 0.34%, while the Dow Jones and S&P 500 fell by 1.82% and 0.64%, respectively. London gold slightly increased by 0.16%.
This week, the European Central Bank cut interest rates by another 25 basis points, reducing the deposit rate from 3.25% to 3% and hinted that further rate cuts would continue.
In China, the Central Economic Work Conference stated that 'more proactive macro policies should be implemented to stabilize the real estate and stock markets.' The subsequent Central Financial Work Conference mentioned, 'more proactive fiscal policies should be implemented to raise the fiscal deficit ratio. Moderate monetary easing should be adopted, with timely reserve requirement ratio cuts and interest rate reductions.' This marks the first time in 14 years that the Chinese government has reiterated 'moderate easing' monetary policy.
Considering the outlook from various countries, the U.S. will face policy turbulence in 2025, potentially encountering inflation rebound and a slowdown in rate cuts; Europe and China may continue to see a decline in economic growth, thus requiring a loose monetary policy to stimulate sluggish economic growth.
Stablecoins and BTC Spot ETF
Although the Christmas holiday is approaching and market trading is becoming lighter, the crypto market still maintains relatively abundant capital inflows. This week, BTC Spot ETF inflows totaled $2.174 billion, and stablecoin channels saw $3.768 billion, totaling $5.941 billion, a decrease from last week but still at a high level.
Sell-off
This week, a total of 268,581 BTC were transferred to exchanges, including 256,826 from short positions and 11,755 from long positions, marking the second-largest sell-off week since November.
Surging buying power, especially from the BTC Spot ETF channel, absorbed selling pressure. Centralized exchanges saw a decrease of 27,901 BTC in stock over the week.
According to eMerge Engine under EMC Labs, the floating profit for short positions has decreased from a previous high of 33% to 25%, which is the neutral level for this bull market.
Particularly, the decisive long position sell-off during the cycle phase has continuously decreased, and BTC prices are expected to rise gradually above $100,000 amidst fluctuations.
Cycle Indicators
EMC BTC Cycle Metrics indicator is 0.875, the market is in an upward phase, showing a vigorous upward state.
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