Under the expectation of a rebound in US CPI, the challenges and opportunities in the crypto space, the trend direction after tonight's CPI announcement!!!
On August 12, Wells Fargo predicted that inflation in the United States would rebound in the second half of the year, with the core CPI and core PCE deflator possibly returning to around 3% in the fourth quarter, and tonight the July CPI data will be released. This has various impacts on the crypto space.
From a market sentiment perspective, a rebound in inflation may exacerbate concerns about the Federal Reserve tightening its monetary policy. If the Federal Reserve delays interest rate cuts or raises rates to respond to inflation, it will reduce market liquidity, leading to capital outflow from the crypto space and putting downward pressure on cryptocurrency prices.
From an asset allocation perspective, inflation data affects investors' preferences for risk assets. If inflation exceeds expectations, investors may turn to traditional safe-haven assets like gold, reducing their allocation to cryptocurrencies.
To prevent unnecessary losses, investors should closely monitor tonight's CPI data and subsequent statements from the Federal Reserve, reasonably control their positions, and avoid excessive leverage. At the same time, diversifying investments in different types of cryptocurrencies can reduce the risk of a single cryptocurrency.
In terms of trend direction, the crypto space may experience increased volatility in the short term due to inflation data and Federal Reserve policy expectations. However, in the long run, if the intrinsic value of the cryptocurrency market continues to grow, and the ecosystem keeps improving, there may still be opportunities to restore an upward trend as the market digests the impact of inflation.
Tonight, Brother K will look for opportunities to set good entry points for everyone to operate, so those who want to keep up should seize the time to join in!!!
