The latest data shows that U.S. retail sales spending rose 1% month-on-month to $709.7 billion in July, which means that the U.S. consumer and labor markets remain strong, easing people's concerns about its economic recession. U.S. stocks continued to rise. As of Thursday's close, the Dow Jones Industrial Average initially closed up 1.3%, the S&P 500 rose 1.6%, and the Nasdaq rose 2.3%. The S&P 500 and Nasdaq achieved six consecutive days of gains. However, the crypto market failed to gain momentum.
In the early trading hours, Bitcoin bulls pushed the price up to $60,000 before quickly falling, dropping 4.7% in the midday trading to the lowest level since the market panic in early August. At press time, Bitcoin is trading at $57,584, down 2.35% in the 24 hours.
Altcoin generally fell. Among the top 200 tokens by market capitalization, Mog Coin (MOG) fell 17%, Dymension (DYM) fell 12.2%, and Popcat (POPCAT) fell 11.6%.
The current overall market value of cryptocurrencies is $2.02 trillion, and Bitcoin’s market share is 55.7%.
Spot market daily trading volume declines
The Block data shows that over the past week, the seven-day moving average of Bitcoin trading volume has dropped from $19.62 billion to $11.5 billion. The seven-day moving average of total spot market trading volume on major exchanges including Binance and Coinbase has also dropped from more than $60 billion last Thursday to more than $36 billion at present.
Crypto traders remain cautious
The cryptocurrency market is currently underperforming the Nasdaq amid turbulent global economic data, and according to Thursday’s Coinbase Weekly report, crypto market participants are expected to remain cautious.
Coinbase analyst David Duong said: "We expect market participants to remain cautious about their risk exposure in the coming weeks. ETH and Solana currently show higher sensitivity to the entire crypto market, with beta values of approximately 0.85 and 0.83 respectively." Analysts pointed out that ETH and Solana have always been the main "beta coins" in the crypto market, with greater volatility than the overall market.
Eliézer Ndinga, head of strategy and business development at 21Shares, said the latest inflation data showed a cooling but stable inflation environment, which is critical for the cryptocurrency market, especially after the overall market downturn last week. However, BTC failed to be boosted by this week's inflation data and trended downward, while U.S. stocks rose. Inflation data released on Wednesday showed that U.S. core consumer prices rose at the slowest rate year-on-year in July since 2021.
Ndinga said: "With inflation arriving as expected, the probability of a 25 basis point rate cut by the Federal Reserve has increased, which may support risky assets. However, Bitcoin and Ethereum reacted negatively immediately after the rate cut, probably because the market hopes that the Federal Reserve will take a more dovish rate cut."
The CME FedWatch tool shows that traders are betting that the Federal Reserve has a 74% chance of a 25 basis point rate cut in September and a 26% chance of a 50 basis point cut.
Bitcoin Still on Track to Reach $150,000
TradingView analyst TradingShot noted: “Bitcoin closed higher last month (July), and despite a sharp drop to start August, the market had managed to recover most of its losses by mid-month. This shows that buying was amazing at the 0.786 Fibonacci retracement level of the 2021 all-time high (ATH).”
TradingShot analyzed BTC’s current monthly chart “and the bullish crossover of MACD.”
He said: “We have only experienced this pattern 5 times in the past 10 years, all during bull cycles, the most recent being in June 2023, and needless to say, BTC had a spectacular rally after that (the first rally of the bull cycle).”
He noted: “From a cycle timing perspective, the June 2023 crossover is similar to the bullish crossovers of November 2019 and December 2015. They formed 25 and 23 months after the high of the previous cycle, respectively, and after they formed, BTC peaked exactly 24 months (731 days) later.”
TradingShot highlights that the MACD bullish crossover in June 2023 “formed 19 months after the previous cycle high, so if it follows the previous peak pattern, Bitcoin should peak around June 2025.
“If BTC touches the top of the dotted channel, its price will reach $150,000, which we believe is a very ideal level to start taking long-term profits,” TradingShot said of the “more conservative path within the ascending channel.”
As for the catalyst that helped the crypto bull market, Charles Edwards, founder of Capriole Fund, pointed out on the X platform: “Exploding” global money supply.
