Crypto Market Weekly Review: BTC Seeks Breakthrough Amidst Fluctuations, Macroeconomic Situation Eases

This week, the BTC market performed steadily, opening at $108,386.44 and closing at $109,217.98, with a rise of 0.77%. The weekly high reached $110,590, while the low dipped to $105,119.70, with a fluctuation of 5.05%. The trading volume continued to shrink.

The crypto market has been relatively calm over the past seven days. Macro events remain key factors affecting Bitcoin's trends, but there have been no unexpected changes in employment data, new legislation, or trade disputes.

It is worth noting that an ancient whale account holding over 80,000 BTC, which had been dormant for 14 years, became active this week, putting some pressure on market sentiment. As BTC approaches historical highs again, the trend of long-term holders reducing their holdings may emerge once more.

However, there are also some positive signals emerging. After more than a month of silence, the activity level of funds in the market has begun to rise. This warming trend may resonate with off-market funds, driving BTC to initiate the fourth wave of this bull market.

Macroeconomic and Policy Trends

This Wednesday, three major macro events intertwine to affect the crypto market.

First, the U.S. employment data performed better than expected. The unemployment rate in June dropped to 4.1%, lower than the expected 4.3% and the previous value of 4.2%. Although private sector jobs decreased, government jobs increased significantly. The latest weekly unemployment claims number was 233,000, also below expectations. These data have alleviated concerns in the market about a U.S. economic recession on one hand, and on the other hand, they have reduced the likelihood of a rate cut in July. Overall, the employment data has a relatively neutral impact on the market.

Secondly, the President of the United States officially signed a new bill, which is the most important political achievement of his current term. The bill includes large-scale tax cuts, increased government budget, and spending cuts. In the long term, this may further undermine the credibility of the dollar, increase the debt burden, and reduce government revenue. However, in the short term, it will undoubtedly have a significant stimulating effect on the economy. Despite differences of opinion in public discourse, the financial markets overall have a positive attitude towards this, directly pushing the S&P 500 index to a new high.

Finally, the trade dispute has entered a new phase. On July 5, it was announced that a new tariff plan targeting 12 countries has been signed, with rates adjusted to a range of 10%-70%, expected to take effect on August 1. This brings new uncertainties to global trade, inflation, and market sentiment. Due to the highest tax rate exceeding expectations, the market reacted slightly negatively, but the impact is relatively limited.

Currently, the U.S. economy shows signs of a soft landing or no landing, and interest rate cuts are expected to begin in September. The new legislation is likely to bring short-term benefits to the U.S. stock market, and the impact of trade disputes will gradually fade. Against this backdrop, the U.S. stock market is expected to continue reaching new highs. However, considering that the current valuation levels are not low, it is important to closely monitor changes in corporate profitability and the impact of tariffs on the economy and employment.

Crypto Market Analysis

Compared to the previous weeks, the BTC market is relatively calm this week, but new changes are brewing internally.

On July 2, Bitcoin once again validated the "first bullish uptrend line", but for most of the week, it fluctuated around $108,000 and made its third attempt at the historical high of $110,000 in the past 8 months.

The retail market shows a clear divergence in performance, with a decline in trading enthusiasm among on-site funds, and both on-chain activity and the number of new addresses remain mediocre. However, the Bitcoin spot ETF market continues to be active and consistently attracts capital inflows.

Currently, the price trend of BTC is mainly influenced by the funding of the spot ETF channel, and its correlation with the Nasdaq index has risen to 0.94.

However, some potential changes are occurring. The on-exchange lending rates and the 30-day average premium rate of the contract market have started to rebound after hitting bottom, but their sustainability still needs to be observed. If the funds in the spot ETF channel continue to flow in while on-exchange funds begin to resonate with long positions, then the fourth wave of increase may arrive soon.

Fund Flow Analysis

After a significant rebound in April and May, the inflow of funds has shown divergence. The inflow of funds through stablecoin channels has weakened, while the inflow of funds through Bitcoin spot ETF channels remains relatively stable and sufficient.

This week, the inflow of funds into Bitcoin spot ETF channels was $790 million, which is a decrease compared to last week, but still maintains a high level. The inflow into stablecoin channels was $1.574 billion, which is basically flat compared to last week.

selling pressure and sell-off situation

As the price approaches 110,000 USD again, long-term holders seem to be resuming their sell-off.

From the scale of inflow into the exchange, the total selling scale of long-term and short-term holders this week is still shrinking, providing support for the upward price of BTC.

However, it is worth noting that an ancient wallet holding over 80,000 BTC, which had been inactive for 14 years, showed unusual activity this week. This has led to a significant increase in on-chain realization value.

Current trends indicate that once Bitcoin breaks through $110,000, the fourth wave of upward movement will be initiated, and the selling by long-term holders and older Bitcoins may be triggered again. These sell-offs will determine the new price level of Bitcoin alongside the buying pressure.

cycle indicator

According to a certain technical indicator, the Bitcoin cycle indicator is 0.625, in an upward phase.