The market has recently entered an adjustment phase, with BTC momentum weakening and both the funding situation and trading activity cooling down. Data shows that trading volume is shrinking and funding rates are holding low, indicating a loosening market structure. Meanwhile, seasonal disturbances in August combined with external uncertainties have made short-term sentiment noticeably cautious. From a technical perspective, $112,000 previously provided support during this round of initial correction, but the subsequent rebound has been weak, suggesting that this support level may face another test.
Macro data fell short of expectations, leading to an overall decline in risk assets.
Overall employment data is weak (unemployment rate rose from 4.117% to 4.248%), indicating a slowdown in the job market. The US Bureau of Labor Statistics also released the largest two-month employment data revision in recent years (excluding the pandemic period) (-258,000). The ISM manufacturing employment index has fallen to its lowest level since the second quarter of 2020, and since Trump was elected in November last year, the ISM manufacturing index has remained in a contraction zone for all but two months. Although manufacturing's contribution to the current US economy is relatively low, historical experience indicates that it remains an important leading indicator reflecting weak economic fundamentals. The current weakness may partially stem from prolonged tariff negotiations, but it also reinforces the judgment that certain sectors of the US economy are facing substantial slowdowns.
Surprisingly, since the implementation of Trump's tariff policy in April, even key non-ISM manufacturing indicators have not shown substantive expansion. Although this indicator remains above the recession threshold, the extent of expansion has always been limited, raising concerns about weak US economic growth.
BTC ETF has entered a inflow mode after six consecutive days of net outflow, with market liquidity improving.
After six consecutive days of net fund outflows (July 31 - August 5), the BTC ETF entered a net inflow mode on the 6th, with a single-day net inflow of $277 million on August 7; the ETH ETF saw a net inflow of $222 million on the same day. This is due to the cooling of risk assets, with the market experiencing noticeable fund outflows since last week, although some relief has been observed this week.
Notably, as institutions have positioned themselves in crypto assets like BTC and professional investors have gradually entered the market, market liquidity has significantly improved, reducing the correlation of BTC price volatility with ETF inflows and outflows. Therefore, despite the speed and scale of ETF fund outflows last week, the crypto market did not experience the kind of sharp sell-off seen prior to the ETF exits.
The market awaits new catalysts, and BTC prices may continue to consolidate.
As the Federal Reserve has not yet released clear signals, even though the market believes that 'the probability of a rate cut in September has increased,' the market may continue to adopt a wait-and-see attitude. With most positive factors already priced in, investors are waiting for new catalysts. In the very short term, oversold stochastic indicators may suggest a possibility of a technical rebound, but it cannot be ruled out that BTC prices will continue to consolidate sideways.
"Whether the repricing of US economic growth expectations will trigger a rebound in actual volatility" is currently a hot topic of concern. As volatility continues to decline, some publicly listed companies holding large amounts of BTC have seen their net asset values (NAV) shrink, weakening their ability to raise funds through issuing new shares and further increasing BTC holdings. Although these companies have recently become the focus of market attention, the key factor actually suppressing this round of market conditions comes from the continued sell pressure of early investors.
Disclaimer: The market carries risks; investments should be made with caution. This article does not constitute investment advice. Trading digital assets may involve significant risks and volatility. Investment decisions should be made after careful consideration of personal circumstances and consultation with financial professionals. Matrixport is not responsible for any investment decisions made based on the information provided in this content.
