Wintermute: Crypto Market Shows Relative Strength This Week, But Uptrend Not Yet Confirmed

BlockBeats News, July 22nd, Wintermute released a market analysis stating that the month-over-month US CPI in June dropped by 0.4%, marking the largest monthly decline since April 2020. The overall inflation rate decreased from 4.2% to 3.5%, below the market expectation of 3.8%. The market has priced out the possibility of a July rate hike by the Fed, but US re-strikes against Iran and the resumption of the port blockade boosted Brent crude oil by 15.54% for the week. Risk assets showed significant divergence: ETH rose by 3.64%, BTC rose by 1.46%, and the Nasdaq index fell by 4.16%.

After the US CPI was announced, Bitcoin briefly rose from around $62,000 to $64,900, and ETH surged by 7% to $1,884 at one point. Approximately $134 million worth of short positions were liquidated within one hour. The US Bitcoin spot ETF saw a total net inflow of about $191 million on Tuesday and Wednesday, ending the streak of outflows for 10 consecutive days. However, compared to the record $4.5 billion net outflow in June, the current inflow size is still insufficient to confirm a trend. Bitcoin held onto its gains after the CPI announcement during the chip stock sell-off, indicating that the crypto market structure is stabilizing, but a definitive upward trend has not yet formed.

Wintermute believes that if the ETF maintains a net inflow for a consecutive week and Bitcoin stays above $66,000 for several trading days, a relatively strong market signal will be confirmed. However, if Brent crude oil surpasses $90 or the Hormuz Strait is officially closed, this assessment may become invalid.