QCP Capital has published a new report in which the trading firm's analysts point to signs of short-term exhaustion in the cryptocurrency market. Bitcoin remains in a narrow range of $116,000-120,000, while Ethereum slows growth at the psychological mark of $4,000.
Institutional interest versus technical signals
Despite ongoing institutional purchases, prices are not reacting to positive news. Strategy and SharpLink Gaming continue to attract capital for buying Bitcoin, confirming long-term confidence in the asset.
However, QCP Capital notes a troubling signal: the market has failed to respond significantly to a series of positive events. The adoption of cryptocurrency legislation in the US and the development of spot and derivatives markets have not led to a substantial price increase. Historically, markets that stagnate amid good news often signal short-term exhaustion.
The dollar is in the spotlight
Analysts at QCP Capital point out the oversaturated short positions on the US dollar. The consensus scenario for 2025 anticipated a weakening of the dollar due to the trade war, but the currency has already fallen by 10% since the beginning of the year.
CFTC data shows extremely short positions by traders on the USDJPY pair. Such positions are not only too obvious but also expensive to maintain. QCP Capital believes the market is vulnerable to a mass closing of dollar short positions, which could lead to a sell-off in stocks, emerging markets, and cryptocurrencies.
The trade war continues
The trade war between the US and other countries continues, despite an agreement with the EU. President Trump insists on resolving the conflict between Ukraine and Russia, but the global political community views these efforts with skepticism.
Key macroeconomic data
QCP Capital emphasizes the importance of upcoming inflation and employment data in the US. Tariff effects are beginning to impact corporate margins and consumer prices, which could make the third quarter a turning point.
Analysts expect the Federal Reserve to keep rates unchanged at the July meeting of the Federal Open Market Committee (FOMC). The central bank's head is likely to emphasize that the decision depends on data ahead of the critical September meeting, where the likelihood of a rate cut remains probable.
