The latest research from Matrix Research Institute shows that the focus in the coming week will be:
With inflation in the US trending lower, BTC could rise as ETF inflows resume.
Perpetual contract investors are preparing for the possible launch of an ETH ETF.
Trump hopes to gain more votes by supporting cryptocurrencies, and Trump-themed meme coins are rising.
The correlation between CPI and BTC price increases. If the next CPI data is lower than 3.3%, BTC is expected to reach a new high.
After 24 years, BTC's price performance was slightly weak in January, soared in March, and entered a consolidation phase in the past two months. With the approval of the BTC ETF, BTC's price drive has changed from being driven by applications to being more affected by macro factors, CPI being one of them.
(BTC price vs. CPI)
Data shows that the market inflow and outflow of BTC ETF is correlated with CPI. In January, the CPI index was as high as 3.4%, higher than the expected 3.2% and higher than the 3.1% recorded last month, and GBTC ETF outflow; in February, the CPI index was 3.1%, lower than the expected 3.4%, and the inflow of funds into BTC ETF gradually recovered and slightly accelerated; in March, the CPI was 3.2%, and the inflow of funds into BTC ETF stopped immediately; in April, the CPI exceeded the expected 3.4% and reached 3.5%, BTC fell to $60,000, and the price fell to around $56,500 on April 30th when the Hong Kong ETF fund flow was weak. In May, the CPI was 3.4% (lower than the 3.5% last month but in line with the expected 3.4%), and Bitcoin rebounded. If the inflation index reaches 3.3% or lower in June, the BTC price is expected to reach ATH. This will provide impetus for net inflows into the BTC ETF market.
Meanwhile, the seasonal trend in June was relatively positive, with an average return of 4%+, while July was even stronger, with an average return of 8%+. Therefore, benefiting from positive seasonal factors, Bitcoin is expected to achieve a gain of more than 12% in the next two months.
(BTC Seasonal Performance)
The inflow of ETH perpetual contract market increased, and the market lacked confidence in the sharp rise of ETH after the launch of ETH ETF
Market data reflects investors' views on ETH ETFs. After the first part of the SEC's approved ETF application was released, the ETH perpetual contract market quickly increased by $4 billion in capital inflows. According to historical experience, before these Ethereum ETFs start trading, investors may take advantage of Ethereum's long positions to profit, because the price of new products usually falls after they are launched. Grayscale's latest report information shows that based on the initial overvaluation, the ETH ETF price has limited further increase compared to the BTC ETF launched in early 24 years.
As crypto assets become more politically oriented, the next government’s attitude towards this emerging digital asset will be crucial.
Grayscale's second-phase poll for the 2024 U.S. election showed that more and more voters are turning to Bitcoin due to geopolitical tensions and inflation, with support rising to 41%. 47% of voters expect part of their investment portfolio to include cryptocurrencies, up from 40% at the end of last year. About 32% of voters expressed a willingness to learn about cryptocurrencies as an investment.
Combined with the SEC's approval of the ETH ETF, cryptocurrency has become an issue that neither party can ignore, and the next government's attitude towards this emerging digital asset will be crucial. At present, both of the two strong contenders in the election have shown an attitude of being close to crypto assets and actively creating related topics, and the political attributes of crypto assets are becoming increasingly high. In the report "Trump May Be the Biggest Driver of Bitcoin's Rise This Year" released by Matrixport on May 10, 2024, it is predicted that as the presidential election approaches in November 2024, if Trump, who supports economic growth and is friendly to cryptocurrencies, leads in the polls, it may drive up the price of BTC.
Trump-USDT’s market value has tripled in just three weeks
The most popular Trump-themed meme coin (Trump-USDT) has tripled its market value to $600 million in just three weeks. As we mentioned in last week’s report “US Political Circles Are Turning to Support Cryptocurrency”, not only Trump and the Republicans, but also the Democrats, as well as President Biden and the White House, are seen as supporting cryptocurrencies.
In the US election years (2012, 2016 and 2020), BTC performed exceptionally well, with an average increase of 192%, and US stocks also performed well. With the popularity of Trump-themed Meme Coin (Trump-USDT), it is not ruled out that more series of Meme coins will emerge in the future.
Some of the above views come from Matrix on Target. Contact us to obtain the full report of Matrix on Target.
Disclaimer: The market is risky and investment should be cautious. This article does not constitute investment advice. Digital asset trading can be extremely risky and unstable. Investment decisions should be made after carefully considering personal circumstances and consulting financial professionals. Matrixport is not responsible for any investment decisions based on the information provided in this content.
