Chicago Fed National Activity Index for July in the United States

The market looks like a SpaceX rocket: straight to the sky . 1.#HOLD# - 2.#HIVP# - 3.#MULTI# - 4.#ISME - 5.#GOV#

Recently, the Fed released the minutes of the July meeting, revealing three key trends that could have a significant impact on the Crypto Assets market. Firstly, the inflation issue remains tricky, and the prospects for interest rate cuts have become more uncertain. Most officials believe that the inflation risks are still higher than the employment risks, and the momentum of inflation easing seems to have stalled. If future economic data does not improve, the possibility of interest rate hikes before the end of the year cannot be ruled out. This could be a negative signal for the crypto market, as tightening liquidity may lead to a sell-off of risk assets, and cryptocurrencies like Bitcoin are likely to adjust accordingly. However, in the long term, the anti-inflation characteristics of crypto assets may attract institutional investors for strategic positioning. Secondly, the tariff issue has raised new uncertainties. The meeting minutes explicitly mentioned for the first time the impact of tariffs on the cost of imported goods, which has triggered market concerns about the potential escalation of trade protectionism. If trade frictions escalate, Bitcoin's status as "digital gold" may be reassessed, and safe-haven demand may rise. At the same time, the uncertainty in trade policies may also affect the Crypto Assets space through traditional financial markets, exacerbating market volatility. Third, interest rates may remain at a high level for some time, and the market is entering a wait-and-see period. Almost all officials support keeping the current benchmark interest rate unchanged, which means that the cost of funds may not continue to rise rapidly. This could lead to funds in traditional markets seeking new investment channels, bringing a certain degree of liquidity improvement to the crypto market. In addition, if major financial institutions are allowed to issue Bitcoin spot ETFs, the pace at which institutional investors enter the market may accelerate. In this complex market environment, individual investors need to closely monitor the upcoming global central bank annual meeting, as the Fed chairman's speech may provide clearer policy direction. At the same time, investors should reasonably diversify their portfolios, maintaining a balance between traditional assets and Crypto Assets, with a priority on mainstream Crypto Assets such as Bitcoin and Ethereum. The Fed's policy changes bring both challenges and opportunities. Investors need to remain vigilant, closely monitor market trends, and manage risks appropriately in order to seize investment opportunities in this uncertain market.

In the investment world, inflation is often viewed as an unfavourable information signal for the market, but this perspective is worth re-examining. In fact, the relationship between inflation and the stock market is far from a simple negative correlation; the key lies in whether inflation is within a "stable and moderate" range. By analyzing the year-on-year trends of core CPI inflation and the NASDAQ Composite Index, we can observe an interesting phenomenon: when inflation rises steadily but does not exceed a reasonable threshold, these two indicators often show a synchronous upward trend. This suggests that moderate inflation does not suppress the vitality of the stock market; rather, it may be a signal of healthy economic operation. In this case, economic demand is released steadily, corporate profit expectations remain stable, and the market does not need to worry about uncontrolled inflation or abrupt policy contraction. This creates favorable conditions for the continuous rise of the stock market and provides a good environment for the continuation of a bull market. The real threats to a bull market are two extreme situations: excessively high inflation and economic recession. When inflation breaks through a reasonable range, it may trigger a tightening of monetary policy, leading to increased financing costs, pressure on corporate valuations, and ultimately resulting in capital withdrawal from the stock market. On the other hand, an economic recession will directly impact corporate profitability; even if inflation is low, the stock market may decline due to deteriorating fundamentals. Therefore, investors need to abandon the simplistic thinking of "inflation is Unfavourable Information" and instead focus on the magnitude and stability of inflation. As long as inflation remains within a reasonable range, there is no need to overly worry about its impact on the bull market. Only when inflation spirals out of control or signs of economic recession appear should one be cautious of market correction risks. Adopting this rational perspective on the relationship between inflation and the market is crucial for accurately grasping the rhythm of a bull market and avoiding key risks. Investors should cultivate sensitivity to economic indicators and analyze various factors comprehensively, rather than simply equating a specific indicator with market trends. Overall, moderate inflation may be a reflection of economic vitality rather than the end of a bull market. It is only when inflation spirals out of control or when the economic fundamentals deteriorate that it could pose a real threat to a bull market. In a complex and ever-changing market environment, maintaining calm and rational judgment is essential for making wiser investment decisions.

In the last 24 hours, the crypto assets market has seen remarkable changes. Data shows that the net outflow of Bitcoin from centralized exchanges (CEX) has reached 1858.51 coins. Although this number may seem small, it could indicate significant market trends in the crypto assets sector. For investors closely monitoring the digital currency market, this pattern of capital flow is worth in-depth analysis. A large-scale outflow of Bitcoin from exchanges is often seen as a positive signal, which may suggest that investors are moving their assets to private wallets for long-term holding. However, before making investment decisions, investors should carefully consider multiple factors. In addition to observing capital flows, attention should also be paid to the macroeconomic environment, regulatory dynamics, and overall market sentiment. It is worth mentioning that the recent release of the Federal Reserve's meeting minutes, the pullback in the crypto market, and the surge of celebrity-related crypto assets trending on social media may all have an impact on the market. These factors combined create a complex and changing market environment for investors. In such market conditions, it is especially important to remain calm and rational. Investors should carefully evaluate each investment opportunity based on their risk tolerance and investment goals. At the same time, continuous learning and keeping an eye on market dynamics are key to maintaining competitiveness in this rapidly changing field.

At the upcoming Fed policy meeting, there may be three possible market scenarios. First, if the Fed Chairman hints at a possible rate cut in September, this will be seen as a positive signal and is likely to drive a rebound in the market, but the probability of this scenario is relatively low, around 20%. Second, if the Chairman states that it is not suitable for a rate cut at the moment, but hints at a possible inclination towards a rate cut in the future, this will also be seen as favourable information, and this scenario has the highest probability, around 50%. Finally, if the Chairman completely avoids mentioning rate cut expectations, or even shows a more hawkish stance, the market may experience a new round of falls, with the probability of this scenario being around 30%. Considering these possibilities, investors may need to adopt a cautious strategy. For the spot market, a phased buying approach can be considered to reduce risk. In the contract market, however, greater caution may be necessary, looking for opportunities in short-term fluctuations while waiting for a clear shift in market trends. Regardless, it is crucial to closely monitor the results of the Fed meetings and market reactions before making investment decisions. Investors should develop investment strategies that suit their own risk tolerance and investment goals.