Top Interest of the Week
Aave ($AAVE), a prominent decentralized finance (DeFi) protocol, has recently garnered significant investor interest following the introduction of the GENIUS Act (Guidance and Establishment of U.S. Stablecoin Innovation Act). This legislative proposal is widely regarded as a potential catalyst for the broader crypto market, as it aims to establish a clear regulatory framework for stablecoins within the DeFi sector. As the largest protocol by TVL in the borrowing and lending space, AAVE experienced a notable price increase, coinciding with the total value locked (TVL) in its network reaching $25.5 billion. Additionally, AAVE’s price surged after community members voted in favor of launching Aave Umbrella, a decentralized risk mitigation mechanism designed to safeguard liquidity providers against bad debt. Through this system, users can stake their Aave aTokens to earn rewards, with the understanding that their staked tokens may be subject to slashing if bad debt occurs.
Plume ($PLUME) suffered a sharp decline of over 10% following the unexpected passing of the network’s co-founder and CTO, Eugene Shen, last Thursday. The news triggered a wave of investor concern, as market participants feared that the sudden loss of the CTO could disrupt the project’s development, including potential challenges in accessing critical coding infrastructure. Although the price briefly rebounded within hours, buying momentum quickly dissipated amid sustained selling pressure.
Raydium ($RAY), the leading decentralized exchange (DEX) on the Solana network, experienced a 24% price decline over the last seven days. One contributing factor was the announcement of a crypto presale by Pump.fun, a meme coin launchpad aiming to raise $1 billion with a $4 billion valuation. Investors expressed apprehension as the Pump.fun team reportedly converts platform-generated revenue into market sales rather than holding it in $SOL tokens. This large-scale presale was perceived as a capital drain from the Solana ecosystem. Our desk observed traders attempting to front-run the market by offloading tokens within the Solana ecosystem, with $RAY among the assets most affected by this sell-off.
Overall Market
The above chart is the BTC price in the 8H candle chart at a log scale.
In our report dated May 29, our analysis indicated that the Bitcoin (BTC) price had fallen below the established seven-week upward trend, represented by the blue line on the chart above. At that time, BTC was trading near the $106,000 level, with key resistance identified at approximately $110,000 and support positioned around $103,000. Given this technical setup, our desk recommended that swing traders exercise patience and consider entering positions closer to these defined support and resistance levels to optimize their risk-to-reward ratio.
The market subsequently unfolded in line with our expectations. BTC’s price gradually declined, primarily due to a lack of sustained capital inflows from the ETF sector. This downward pressure was further compounded by the release of the Personal Consumption Expenditures (PCE) price index data, which reinforced the Federal Reserve’s hawkish stance on interest rate policy. As a result, expectations for rate cuts were pushed further this year. Over the weekend, BTC found support near the $103,500 level and began to recover, as illustrated by the red trend line on the chart. This red trend line highlights an emerging upward channel characterized by higher highs and higher lows on the 8-hour candlestick chart, signaling a potential bullish momentum shift.
On Thursday, bullish sentiment strengthened as BTC once again found support along the red trend line. This positive momentum was supported by the European Central Bank’s announcement of a 25 basis point rate cut at its June meeting, which eased global liquidity conditions and provided a favorable backdrop for risk assets worldwide. Additionally, US President Donald Trump confirmed that he had accepted an invitation to meet Chinese President Xi Jinping following a 90-minute phone call focused on trade issues. The constructive tone from both parties during this exchange helped lift the US stock market, with the S&P 500 index reaching an intraday high of 5,999.70.
However, market optimism was tempered by escalating tensions between Elon Musk and President Trump on social media, raising concerns about political stability in the United States. After Musk publicly opposed Trump’s “One Big Beautiful Bill,” President Trump retaliated by threatening to terminate government subsidies and contracts to Musk’s companies. This confrontation led to a sharp 14% decline in Tesla’s stock price within a single day. The negative sentiment spilled over into other asset classes, with BTC dropping 4% to an intraday low of $100,300 and Ethereum (ETH) falling more than 7%, trading below $2,400.
As depicted in the chart, the $103,000 level has now shifted to act as a resistance point, while the $100,000 level serves as critical support. Our desk expects BTC to trade within this relatively narrow range as the market awaits further developments in the Musk-Trump dynamic. Should BTC break above the $103,000 resistance swiftly, we anticipate a follow-through rally that could push prices back toward the $106,000 level. Conversely, a decline below the $100,000 support could open the door to a deeper correction, with the next significant support zone lying between $95,000 and $97,000.
Bitcoin ETF Tracker
The above table is the BTC spot ETF net inflow data in the past five trading sessions.
Following the substantial capital inflow into Bitcoin (BTC) exchange-traded funds (ETFs) observed last week, the BTC price was unable to sustain its upward momentum. Our desk has since identified a notable net capital outflow from the ETF sector, which contributed to a decline in BTC’s price from $108,000 to $103,500 by Friday. This outflow is particularly significant because it represents a reversal of one of the key drivers behind the recent BTC price rally. We interpret this movement as a classic case of profit-taking by investors, which has introduced selling pressure on BTC and triggered a subsequent price retracement. Such dynamics are common in markets following rapid price appreciation, as investors seek to realize gains and rebalance their portfolios.
Looking ahead, we anticipate that capital flows within the ETF sector will continue to be a critical determinant of BTC’s price trajectory. Given the current limited participation from traditional financial institutions in this digital asset class, BTC’s price movements are likely to be more sensitive to shifts in investor sentiment and macroeconomic developments. Our analysis suggests that caution is warranted in the short term, as BTC’s volatility may increasingly reflect broader economic and geopolitical factors. These include ongoing tariff negotiations between major economies and persistent geopolitical tensions, notably the Russia-Ukraine conflict, which continue to inject uncertainty into global markets.
Macro at a glance
Last Thursday (25-05-29)
The initial jobless claims in the US increased from 226,000 to 240,000, surpassing the anticipated figure of 229,000. While the US labor market continues to demonstrate resilience, it is beginning to exhibit early signs of a downturn.
The projected quarterly growth for US GDP is -0.2%, which is a slight improvement over the earlier estimate of -0.3%.
Last Friday (25-05-30)
The German Consumer Price Index (CPI) is anticipated to experience an annual growth of 2.1% in May, which is marginally above the predicted 2.0%.
In April, the US Personal Consumption Expenditures (PCE) Price Index recorded a 2.1% annual increase, which is slightly below the expected 2.2%. Meanwhile, the core PCE price index achieved a yearly growth of 2.5%, aligning with market forecasts.
On Monday (25-06-02)
In May, the US S&P Global Manufacturing PMI registered at 52.0, which is marginally lower than the anticipated 52.3 but an improvement over April’s figure of 50.2.
Additionally, the US ISM Manufacturing PMI was noted at 48.5 in May, falling short of the predicted 49.3.
Both manufacturing PMI figures for the US in May did not meet market expectations, suggesting that the adverse effects of tariffs may be beginning to influence the US manufacturing sector.
On Tuesday (25-06-03)
The Eurozone's Consumer Price Index (CPI) is anticipated to be 1.9% in May, which is below the expected 2.0% and April's figure of 2.2%. Core CPI also experienced a decline from 2.7% in April to 2.3% in May, falling short of the predicted 2.4%. As the CPI indicates a downward trajectory towards the 2% target, the likelihood of an additional rate cut by the European Central Bank (ECB) on Thursday rises.
In the United States, the Job Openings and Labor Turnover Survey (JOLTS) revealed an increase in job openings for April, rising from 7.2 million in March to 7.391 million in April, surpassing the forecast of 7.110 million.
On Wednesday (25-06-04)
The Bank of Canada announced that it will maintain its interest rate at 2.75%, unchanged.
In a surprising turn, the US ADP nonfarm employment change fell short of market expectations, reporting only 37,000 new jobs added in the private sector for May, which is significantly below the analyst forecast of 111,000. Following the release of this data, US President Trump called on the Federal Reserve to reduce its interest rate.
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