Matrixport Investment Research: Short-term overbought, strong capital inflows boost Bitcoin's rise

After seven months of consolidation, the BTC spot ETF has seen an unusually large inflow of funds. Starting with a 50 basis point rate cut in mid-September, Federal Reserve Chairman Powell assured the market of an extended rate cut cycle, further accelerating the inflow of funds into the BTC spot ETF. Driven by rising prices and increased media attention, BTC's strong momentum is expected to continue through December, attracting new investors. Optimism also surrounds the inauguration of Trump on January 20, 2025, which could lead to a more favorable crypto regulatory environment, including the appointment of a new SEC chairman. Additionally, the expected announcement of $16.5 billion in repayments to FTX creditors may also support market sentiment. These factors create a favorable backdrop for sustained bullish sentiment and BTC price stability. By 2025, crypto assets will cross the 8% adoption threshold, a major inflection point that will lay the foundation for larger-scale adoption. Among the key factors driving BTC to new highs this quarter, three major changes in the US regulatory landscape are most important. First, on December 6, S&P Global may announce the inclusion of MicroStrategy in the S&P 500 index, prompting index funds to enter the market. Second, on December 10, Microsoft will consider a proposal to invest in BTC, despite opposition from the board. Previously, the National Center for Public Policy Research submitted a proposal based on the "2025 Plan" to evaluate BTC as an investment target. Finally, starting December 15, 2024, the Financial Accounting Standards Board (FASB) will introduce new rules allowing crypto assets to be recorded at fair market value on company financial statements, encouraging finance departments to include BTC on balance sheets. Historical data shows that when BTC's Relative Strength Index (RSI) reaches overbought levels or the 30-day rolling return exceeds 40%+, its price often consolidates as momentum cools. Given the recent overbought conditions, a brief consolidation phase may occur. However, many positive factors are gradually emerging. Observing the 7-day rolling price change rate (in US dollars) reveals BTC's current momentum. As BTC prices rise, the absolute price difference increases, but the recent 7-day price increase of $19,265 is a historic high, indicating an unprecedented rebound. The above views are from Matrix on Target, contact us to get the full Matrix on Target report. Disclaimer: There are risks in the market, and investments require caution. This article does not constitute investment advice. Digital asset trading may have great risks and instability. 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.