🚨Macro Liquidity Shift! Analysis of Key Nodes in the Crypto Market

The current core observation points in the market have shifted towards macroeconomic data and policy directions:

1️⃣ Federal Reserve Interest Rate Cut Expectations: CME FedWatch shows that the probability of a rate cut in September has risen to 68%, but caution is needed regarding potential adjustments in expectations based on GDP (7/25), PCE (7/26), and JOLTS (7/31) data;

2️⃣ New Dynamics in Tariff Negotiations: Following China's exemption of tariffs on U.S. ethane, costs in the chemical industry chain have decreased by 5-8%, which may alleviate some inflationary pressures;

3️⃣ Impact of the U.S. Election Cycle: The policy window before the 2026 midterm elections, where both parties may increase subsidies in the energy and technology sectors;

Interestingly, the current market pricing has partially reflected expectations of a macro shift, but the following potential risk points are worth noting:

- If the Consumer Confidence Index continues to stay below 65 (previous value 65.6)

- If the Core PCE month-on-month exceeds the 0.3% threshold

- Expansion of term premium due to weak demand in Treasury auctions

From a cyclical perspective, historically, the three months before and after the end of QT are usually a period of increased volatility for risk assets (see 2019 case), while the current pace of the Federal Reserve's balance sheet reduction has decreased to $35 billion/month.

Note: Policies in election years typically bring structural opportunities, but caution is needed regarding the potential "fiscal cliff" risk that may arise after November. Recommendations to focus on:

• Energy policy-sensitive assets

• Sectors directly impacted by tariff adjustments

• Interest rate-sensitive tech stocks

The current market is at a critical node of macro narrative transformation, and it is advisable to maintain flexibility in the portfolio.