Author: 0xBrooker
This week, BTC opened at $108,386.44 and closed at $109,217.98, up 0.77%. The highest price was $110,590, and the lowest was $105,119.70, with a fluctuation of 5.05% and trading volume continuing to shrink.
The past week was relatively dull, with macro events still being the decisive factor for BTC price movements. However, neither the employment data, the 'Big and Beautiful Act,' nor the reciprocal tariff war has produced changes beyond market expectations.
An ancient giant whale with a position exceeding 80,000 BTC and silence for over 14 years has begun to move assets this week, creating some psychological pressure on the market. As the BTC price approaches historical highs again, the trend of long-term holders reducing their holdings may reappear.
Some positive changes are also occurring; after being dormant for over a month, the activity of funds in the market is beginning to strengthen. This increase may resonate with off-market funds, pushing BTC to initiate the fourth wave of this bull market.
Policies, macro finance, and economic data
This week, three major macro events intertwined to impact the cryptocurrency market.
Firstly, U.S. employment data exceeded expectations. Data released on July 3 showed that the U.S. unemployment rate for June was 4.1%, significantly lower than the expected 4.3% and below the previous value of 4.2%. A deeper dive into the data reveals that while private employment declined, state government jobs surged. The number of unemployment claims for the week ending June 28 was 233,000, also below the expected 240,000 and the previous value. The latest employment data has alleviated market concerns about a U.S. economic recession and reduced the probability of a rate cut in July to 4.7%. Ultimately, the market impact is relatively neutral.
Secondly, on July 4, the U.S. President officially signed the 'Big and Beautiful Act,' achieving the largest political gain of his term so far. The act includes large-scale tax cuts, a significant increase in government budgets, and spending cuts, which may further reduce the dollar's credit in the long run, increase debt, and decrease government revenue. However, in the medium to short term, it will undoubtedly have a significant stimulating effect on the economy. Therefore, although there is considerable public debate, the financial market has generally interpreted it positively, directly driving the S&P 500 index to continue reaching new historical highs this week.
Thirdly, the 'reciprocal tariff war' has fully entered its third stage—on July 5, Trump announced he has signed a 'tariff letter' to 12 countries, setting a 'flat rate' country-specific tariff, with the final tax rate range adjusted to 10%–70%. This letter will be sent out on July 7. The tariff is likely to take effect on August 1, bringing new uncertainties to global trade, inflation, and market sentiment. As the maximum extent exceeded the expected 50%, the market reacted negatively, but the pricing adequately reflected the situation, resulting in a smaller response.
In our observation framework, the current U.S. economy exhibits characteristics of either a soft landing or no landing. Interest rate cuts will begin in September, and the 'Big and Beautiful Act' will bring a positive impact to U.S. stocks in the medium to short term. The equal tariff shock is about to pass, allowing U.S. stocks to set new historical highs again. In the medium to short term, under the expectation of rate cuts, prices may continue to rise. However, the current valuation of U.S. stocks is not low, necessitating close attention to changes in corporate profitability and the impact of tariffs on the economy and employment data.
Cryptocurrency market
Compared to the past few weeks, due to the continuity of macro market information, the BTC market was relatively quiet this week, but changes are brewing internally.
On July 2, BTC once again validated the 'first upward trend line of the bull market,' but spent most of the week hovering around the $108,000 mark, making its third attempt at the historical high of $110,000 in the past eight months.
The BTC retail market shows clear signs of differentiation, with trading enthusiasm among on-market funds waning and on-chain activity and new addresses performing modestly. However, the BTC Spot ETF market is bustling with trading and has recorded sustained capital inflows.
Currently, the BTC price and trend are entirely controlled by the BTC Spot ETF channel's capital, with the correlation between BTC trends and the Nasdaq index rising to 0.94.
Some changes may be occurring; after the on-market borrowing rates fell to a low, they have begun to rebound. The 30-day average premium rate in the contract market has also started to rebound after hitting a low. Of course, both need to be observed for sustainability. In our June report, we predicted that the market would step up again in the third quarter. If the BTC Spot ETF channel continues to see inflows and on-market funds begin to resonate with buying, the fourth wave of increases may be realized soon.
Capital inflows and outflows
After a significant rebound in April and May, capital inflows have shown divergence; the stablecoin channel's capital is starting to weaken, while the BTC Spot ETF channel's capital remains relatively strong and stable.
This week, $790 million flowed into the BTC Spot ETF channel, noticeably weaker than last week but still maintaining a high level.
Cryptocurrency market capital inflow statistics (weekly)
Stablecoin channel inflows reached $1.574 billion, close to last week's figures.
Selling pressure and sales
As the price once again challenges $110,000, long-term holders seem to be initiating reductions in their holdings.
In terms of the scale of transfers to exchanges, the total selling scale of both long and short positions has continued to decrease this week, providing strong support for BTC's price upward movement.
However, this week an ancient wallet holding over 80,000 BTC showed unusual activity. The significant movements from this dormant wallet, which had been silent for 14 years, led to a substantial increase in on-chain realized value.
On-chain value realization statistics
Based on the current trend, once BTC breaks through $110,000 and initiates the fourth upward wave, the selling of long-term and high-age BTC should restart. These sales will jointly discover a new price for BTC and determine its height.
Cycle indicators
According to eMerge Engine, the EMC BTC Cycle Metrics indicator is at 0.625, indicating an upward phase.
