After a day of observation, many macro analysts have started looking for signs of recent interest rate cuts.. The logic is roughly as follows:
1. Based on Powell's character, he is unlikely to surprise the market suddenly.. So, if the plan is to start cutting rates for the first time in September, then tomorrow's midnight FOMC speech might start hinting at that.. "Fed Mouthpiece" Nick hinted at this yesterday.. So, be prepared for the possibility of dovish remarks in tomorrow's midnight speech..
2. Recently, the US has been issuing more short-term bonds than long-term bonds.. This indicates that interest rate cuts may be coming soon.. So now, they are only issuing high-interest short-term bonds.
Recently, Glassnode observed an unusual divergence from the skew data of the Bitcoin options market:
The one-month put option premium has reached +4.6%, indicating that medium-term investors are hedging against downside risks or starting to lock in previous gains.
The skew of the one-week options is obviously low, indicating that market sentiment remains bullish in the short term, with many traders inclined to buy one-week call options to speculate on further BTC increases.
This short-long structure overall indicates a strong short-term sentiment, with capital betting on a rally; however, it raises caution in the medium term, gradually hedging against pullback risks.
Looking back at the past two days...
Looking back, the moves have been quite orderly.. On Sunday, I noticed that the contract orders formed a range between 119.0k~117.6k.. At that time, I thought that after the CME opened this week, there would be a dual kill above 119.0k and below 117.6k.
However, this wave of drama took 2 days to unfold...
So, I have not done well.. I didn't hold onto the short at 119.8k.. Mainly because I saw yesterday's strong move at 120k.. Aiming to clear some liquidity above 120k before shorting again.. However, just after saying this yesterday, there was a downward move...
Now, I still hold onto the two low positions at 118.4k and 117.6k from yesterday.. The earlier position at 119.1k has been reduced by 3/4.. Let's see if this remaining portion can test 120k again..
Looking at today's order situation... The contract market has been really orderly.. After the orders around 117.6k were placed yesterday, now they are densely placed between 119.0k~120k.. It should be the same batch of funds.. (This has been observed over the past week, as mentioned in last week's article)
At the same time, there are quite a few orders in the spot market around 120k and below....
Finally, today’s thought.. The recent orders in the contracts have been too orderly, making it hard to resist shorting again below 120k.. But we must always be wary of a spike liquidation between 120k~121k.. Also, we need to guard against potential speculation on interest rate cuts.. Therefore, I will continue to maintain a smaller position for high shorts, part below 120k, and part below 121k.. If it stabilizes above 122k, I will exit.. (The one-week liquidation void is near 122k)
I still plan to add a portion around the range of 200 points above and below 11.80.. Preparing to hold this low position until after the FOMC speech.. Let's see if this dovish expectation really materializes..
