“When government bonds and crude oil data move simultaneously, the undercurrents in the cryptocurrency market have already surged!”
1. Surge in government bond yields = Warning of 'bloodletting' in the crypto market!
The yield on the U.S. 2-year government bond has soared to 3.92% (although not officially announced, the market has reacted), indicating that institutions are more willing to lock in 'risk-free returns'. Large leverage holders in the crypto market may sell BTC/ETH for USD to earn interest — last week's large BTC sell-off on Coinbase was a signal!
2. Crude oil inventories plummeting by 2.41 million barrels = Inflation bomb?
API crude oil inventories fell by 690,000 barrels more than expected; if oil prices rebound, the Fed's interest rate hike expectations will rise again! The probability of a rate hike in September has jumped from 20% to 35% (CME data). The script of BTC halving in the September 2022 rate hike cycle may replay!
3. Refining oil inventories increased by 535,000 barrels = Evidence of economic recession?
Weak gasoline demand (inventory reduction not meeting expectations) + backlog of refined oil suggests a decline in U.S. consumer power. If the economy hard-lands, institutions will sell risk assets (including cryptocurrencies) for cash — referencing the 50% BTC crash on 'Black Thursday' in March 2020!
“When data conflict, focus on BTC and its correlation with U.S. stocks!”
Case 1: After the API data was released on August 22, WTI crude oil rose by 2%, but BTC fell by 1.5%, indicating that the market is more worried about interest rate hikes rather than inflation.
Case 2: The bond auction bid-to-cover ratio was only 2.62 (historical average 3.0), proving that large funds are watching and waiting. If there is a rate hike in September, liquidity in the crypto market will be even more strained!
If tonight's EIA crude oil data is unexpectedly low again, is it time to buy the dip or to escape?
Follow me for a live breakdown of the movements of on-chain whales at 11 PM — they have quietly positioned themselves with 32,000 BTC options! #比特币远古巨鲸持续出清
