Report dated June 14, 2025.
Yesterday, after the U.S. stock market opened, there was a pullback, with major indexes like Nasdaq and S&P 500 all falling, and the Russell 2000 showing the most significant decline, indicating that U.S. stock investors are also exhibiting some risk-averse sentiment.
The VIX fear index surged to 20.82, entering a high volatility risk zone, while the fear and greed index has also dropped to around 52, indicating a noticeable increase in market risk aversion.
This is mainly due to the tense situation in the Middle East, where Iran has launched a new round of missile attacks against Israel, prompting air raid alarms in multiple locations in Israel.
As a result, oil prices have surged rapidly, causing crude oil prices to skyrocket. When oil prices rise, U.S. inflation expectations are pushed higher.
Although core CPI does not include energy prices, the U.S. is a country that relies heavily on transportation. When oil prices increase, costs across various sectors such as transportation and services also rise, leading to greater inflationary pressure.
This reduces the Fed's room for interest rate cuts, especially since the tariff issues are not yet resolved, making everyone more cautious.
If the U.S. gets further involved in the Middle East conflict, the fiscal deficit will surge, and the government may increase its debt issuance, which would put even more pressure on risk assets like U.S. stocks.
So, oil prices have now become an important indicator for observing geopolitical conflicts.
However, Bitcoin's performance has been relatively stable, currently oscillating around $105,000.
From the data, the increase in Bitcoin price volatility has raised turnover rates. Short-term investors who bought the dip in the last two days have been trapped, and some who lost money have already fled. However, long-term investors who accumulated coins early are completely unflustered and are not interested in short-term fluctuations.
Bitcoin spot ETFs recently saw a net inflow of $86.31 million, with four consecutive days of net inflow.
Ethereum spot ETFs are even more aggressive, with a net inflow of $112 million, marking 19 consecutive days of net inflow, indicating that U.S. institutions are still continuously buying. Moreover, the buying momentum for Ethereum has surpassed that of Bitcoin. Short-term buying pressure is relatively strong, so it won't drop much for now.
From the support levels, Bitcoin has its strongest support in the range of $93,000 to $98,000, with 1.8 million Bitcoins stacked around $105,000, and the accumulation is still increasing. If the accumulation continues, the market may need to choose a direction.
From a funding perspective, on-site funds have increased by $5.8 billion, bringing the total to $260.3 billion. The market cap of USDT is $155.192 billion, slightly up by $0.4 billion, while USDC's market cap has decreased by $0.12 billion.
This indicates that capital inflow in the Asian market has stopped, and there is some outflow in the U.S. market, with trading volume slightly increasing.
This time, the statistics include an additional $5.8 billion mainly due to the inclusion of Binance Bridged USDT, which aligns with the significant increase in the total amount of stablecoins.
However, the liquidity supporting Bitcoin's rise is somewhat weak right now.
Data from ETFs, stablecoins, and trading volume all indicate that actual purchasing power is low. This is different from the rise driven by traditional investors at the end of 2024. This time, the upward momentum seems more like internal funds in the crypto space hyping themselves up, and the issue of insufficient liquidity is quite evident.
Overall, the market's focus is currently on geopolitical conflicts, and oil prices are a key indicator.
Liquidity is lower over the weekend, and sudden news could lead to significant market volatility, so those trading contracts should be cautious.
It is recommended to primarily wait and see. If a significant pullback occurs, it would be a good opportunity to buy in batches.
