Over the past week, BTC has finally broken through the previous pressure level and entered the $67,000 - $69,000 range, and on the 21st it broke through $69,000, reaching a high of $69,519. Although it encountered resistance on the day and was unable to rise further, falling to $66,571, with the market building positions at low levels, BTC returned above $67,000. As of the publication of this article, the BTC price is fluctuating around $67,185 (the above data is from Binance spot, 3:00 PM on October 22).
Currently, the resistance around $70,000 for BTC is relatively strong, and the price is relatively moderate in the short term. But with the approach of the US election, the Trump effect is gradually emerging, and the market is pre-positioning, if BTC successfully breaks through the resistance, it is expected to challenge new highs.
Market Analysis
Multiple Fed officials speak, adjusting market expectations for future rate cuts
On October 21, Eastern Time, multiple Fed officials gave speeches, adjusting the market's expectations for rate cuts. The three major US indices reacted differently, with the Dow Jones index falling significantly and the Nasdaq index turning positive. Dallas Fed President Logen said the economy is strong and stable, but uncertainty remains, and if the economy meets expectations, he expects "gradual" rate cuts. Minneapolis Fed President Kashkari said the high inflation in the US is not caused by the labor market, and the pace of rate cuts in the next few quarters is expected to slow down. Kansas City Fed President Schmid directly stated that in the face of uncertainty, he hopes to slow the pace of rate cuts.
Spot and futures gold prices hit new highs, market risk aversion sentiment is obvious
On October 2, Eastern Time, COMEX December gold futures rose to $2,755.40 during the session, hitting a new high; spot gold CFD also rose to $2,740.44 during the session, hitting a new high. Although both fell back and turned negative at the close, gold prices have risen more than 30% this year, and the market generally believes that gold prices will continue to rise.
The continued rise in gold prices, in addition to the uncertainty of the US election and the continued escalation of the situation in the Middle East leading to an increase in market risk aversion demand, the large-scale purchases by central banks and the interest rate cuts in the US are also important driving factors.
BTC futures nominal open interest hits new high, BTC market participation continues to rise
Coinglass data shows that the nominal open interest of US dollar-denominated Bitcoin futures on major exchanges broke through $40.63 billion over the weekend, hitting a new high. The open interest is 592,000 BTC, the highest level since December 2022. At the same time, the market inflow of BTC ETFs continues to increase, taking BlackRock's IBIT ETF as an example, it attracted over $1.1 billion in funds last week, the strongest performance since March this year.
Suggested Layout
Although BTC and ETH are now approaching the critical $70,000 and $2,800 resistance levels, based on the lack of major catalysts recently, the market performance this week should be mainly moderate fluctuations. If ETH rebounds strongly again this week, once the $2,800 breakthrough is completed, it may bring new attention to the crypto market and boost the market.
At the same time, based on the rise in the 10-year US Treasury yield, the prices of safe-haven assets (gold, silver) in the market, and the market's downward adjustment of the average return on US stocks over the next 10 years, the US stock market is gradually trending towards independent bull market performance of blue-chip stocks. Against the backdrop of the uncertainty of the US election and local geopolitical volatility, the probability of black swan events occurring is increasing, and it is recommended to carefully assess the risks and make market layouts. Although Trump's odds have risen sharply, the current poll data is still relatively tense, and investors who have pre-positioned the Trump effect need to be cautious.
In the current market environment, using principal-protected structured products to achieve principal and interest protection, and obtain token-based appreciation, is a good choice. Shark fin or trend-following products, on the basis of cost protection, if the market trend judgment can obtain relatively good additional returns, are suitable for investors who are long-term bullish on BTC and ETH.
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