Market Observation Weekly Report [6.9 - 6.13]: Geopolitical disturbances and cautious capital resonate, Mainstream Token fluctuates and adjusts, market consolidates at high levels.

The turbulent geopolitical situation affects the market, mainstream cryptocurrencies are experiencing fluctuations and adjustments, altcoins are retreating, and the overall status is in a high-level consolidation phase

The macro environment is becoming more volatile, and market sentiment is fluctuating:

• The tense situation in the Middle East has triggered a short-term risk aversion sentiment, volatility has decreased, expectations for a Federal Reserve interest rate cut have risen, and market attitudes are becoming more cautious and observant.

The marginal improvement of capital inflow momentum lacks sustainability:

• Cryptocurrency ETFs see net inflows again but momentum weakens, the growth rate of stablecoin issuance declines, stablecoin premiums weaken, and the attitude of capital entering the market is cautious.

Mainstream cryptocurrency trends are diverging, Bitcoin's strength is weakening, and Ethereum is adjusting again after a rebound:

• Bitcoin faced resistance and pulled back after a surge, while Ethereum saw a follow-up rise but lacks momentum. Institutional investors continue to increase their holdings, and the overall structure still leans towards neutral to strong.

Small-cap cryptocurrencies see marginal liquidity improvement but face resistance in upward movement:

• The total market capitalization of non-mainstream cryptocurrencies has been hindered in its rebound and has once again retreated, with market share stabilizing after a decline, while on-chain activity remains in a weak range.
• The current market is in the final stage of consolidation. In the short term, attention should be paid to the breakthrough of funds in conjunction, patiently waiting for the structural strengthening of small-cap coins and signs of capital inflow into mainstream tokens.

1. Macroeconomic Environment and Market Dynamics

• Geopolitics: The situation in the Middle East is tense but the risk of a full-scale conflict is limited, expected to last for about two weeks, with the U.S. providing support but not directly intervening.
• Market Performance: Oil prices rise due to sentiment, Bitcoin retreats to $105,000, US stocks rebound, market volatility decreases and tends to stabilize.
• Economic Policy: Expectations for interest rate cuts in July are rising, as the Federal Reserve seeks a balance between inflation and economic growth.

2. Fund Flow Analysis and Mainstream Cryptocurrency Market Structure

External Capital Flow

• ETF Funds: This week saw an inflow of $2.8 billion, significantly increasing the inflow scale.
• Stablecoin: This week, an additional issuance of $2.3 billion occurred, with an average daily issuance of $321 million, indicating a high level of issuance.

Market Sentiment Indicator

• OTC Premium: The premium for stablecoins continues to rise slightly.

Bitcoin(BTC)

• Technical Analysis: The market is in a volatile upward channel.
• On-chain chip distribution: Chips above $103,000 are enhanced

Ethereum(ETH)

• Performance weaker than Bitcoin, the ETH/BTC ratio remains volatile, with funds continuously flowing into Bitcoin.
• On-chain data: The number of active addresses has increased, which may indicate that the phase of bottoming out is complete.

Macroeconomic Review

Pay attention to geopolitical conflicts

• Geopolitical Background:

The terrain in the Middle East is complex, and there are significant differences in population and conventional weapon numbers, which limits the possibility of large-scale ground conflicts. Unless there is direct intervention from external forces, conflicts may be confined to targeted strikes.

• Scale and Duration of Conflict:

It is expected that there will be low-intensity confrontations lasting about two weeks, rather than a full-scale conventional or nuclear war. Geographic factors further limit the possibility of direct contact.

• Impact Assessment:

In the current situation, market concerns about a full-scale war are relatively low, with geopolitical risks mainly manifesting as emotional fluctuations rather than substantial military escalation.

• Oil Price Trends:

The recent rise in oil prices is mainly due to emotional reactions rather than supply disruptions, as the conflict has yet to impact oil infrastructure. There is no direct effect on global oil supply in the short term.

• Stock Market and Cryptocurrency Market:

Although the US stock market saw a slight decline before the opening, it rebounded later, with Bitcoin rising to $105,000, indicating an improvement in market sentiment. Volatility fell from the morning high and fluctuated within the $1,000 range in the afternoon.

• Volatility Change:

Compared to the beginning of the year, the current market sensitivity to geopolitical factors has decreased, and the volatility has lessened.

• Institutional Holdings Impact:

Institutional investors are increasing their positions, the circulation of coins is decreasing, and the market structure is becoming more mature, resembling traditional stock market patterns. The ETF lock-up effect is significant, increasing market stability.

• Market Rhythm:

The correlation between Bitcoin's price movement and the stock market has increased, with extended decision-making cycles from institutions leading to a reduction in circulating tokens and improved market stability. However, in the short term, it is still driven by sentiment, as seen in the rebound after morning fluctuations.

• Comparison with Other Cryptocurrencies:

Ethereum and Solana, lacking large-scale ETFs and institutional depth participation, still maintain high volatility.