📢 Check out HashKey Global Weekly Report (4th Week of Jul) 🌟 Highlights – US president Biden will not seek reelection – US ETH spot ETF listing. – Donald Trump attended Bitcoin Conference 2024. 📅 Upcoming The July FOMC meeting will end this coming Wednesday. Investors should pay attention to the market risks. 🔍 For a deeper dive, join our Discord community for the full report 👉
Abstract
Last week, there were a number of market events, including the release of PCE data, the announcement of the quit reelection of US President Biden, Trump’s speech at the Bitcoin Conference 2024, and the official listing of the US Ethereum spot ETF. During the week, Bitcoin price peaked at about $69,400 and the lowest at about $63,400, a difference of about 9%, indicating the intense competition between Bull and Bear. This week’s focus is on the FOMC meeting on the 31st, which will determine the US interest rate.
Interest Rate Cut Expectations
On July 26, the US Department of Commerce announced that the personal consumption expenditure index (PCE) for June rose by 2.5% year-on-year, hitting a new low in five months, in line with market expectations and lower than the previous value of 2.6%. It shows that inflationary pressure has not increased, which has a positive impact on the market. Investors’ expectations for the Federal Reserve’s possible interest rate cut this year are further strengthened. Next Wednesday, July 31, the Federal Reserve will hold a FOMC meeting. According to the FedWatch Tool, the meeting kept interest rates unchanged by as much as 90%, while the September meeting had an 88% chance of a rate cut.
Source: FedWatch Tool
US Crypto Spot ETF
Bitcoin Spot ETF
Last week, the Bitcoin Spot ETF performed normally. In addition to recording a net inflow of more than 4 million US dollars on the first day, there were a small amount of net inflows and outflows in the following days, amounting to less than 100 million US dollars. The market focus may be on the listing of the Ethereum Spot ETF, which will reduce the Bitcoin Spot ETF transaction volume.
Ethereum Spot ETF
On July 23rd, the Ethereum Spot ETF was officially listed and traded in the US. Except for the net inflow recorded on the first day of listing, the net outflow was recorded in the next three days, with an average of more than 100 million US dollars. The ETHE released by Grayscale recorded a net outflow every day, and the rest of the ETF issuers recorded a net inflow. The ETH price also fell from the high of $3,541 on the 23rd, and the low in the middle of the week reached $3,090. The ETH price trend was similar to BTC price trend while Bitcoin Spot ETF was listed.
Source: Farside Investors
Market Information
On July 22, the current US President Biden announced that he would not seek for reelection and support Vice President Harris Kamala as the presidential candidate of the Democratic Party in 2024. Before that, Harris Kamala had never publicly shared her views on the crypto industry. Two days later, Bitcoin enthusiast and billionaire Mark Cuban revealed that he had received multiple questions from Harris Kamala’s advisory team about cryptocurrency. Hinting that Harris Kamala may be more supportive of the development of the cryptocurrency field than Biden.
On July 25, Steven Fulop, the mayor of Jersey City, the second largest city in the US state of New Jersey, said that the Jersey City Retirement Fund is updating its filings with the SEC to allocate a specific percentage of the fund to a Bitcoin ETF, following the Wisconsin Retirement Fund’s allocation of 2% in a Bitcoin ETF.
On July 27, US presidential candidate Trump attended the Bitcoin 2024 conference organized by Bitcoin Magazine and delivered a speech. He focused on three main points, he would fire SEC Chairperson Gary Gensler on the first day of his election, never sell Bitcoin owned by the US government and hold Bitcoin as a strategic reserve asset. Finally, he also mentioned the establishment of a presidential advisory committee on Bitcoin and cryptocurrency, which would include transparent supervision and regulations to help the entire crypto industry.
On the same day, Republican Senator Cynthia Lummis, who has long supported the development of cryptocurrency, also attended the Bitcoin 2024 conference. She said that she is promoting the proposal to let the US Treasury buy 1 million Bitcoins in 5 years. She said that the main reason for listing BTC as a national reserve is to offset the impact of the depreciation of the US dollar.
Separately, independent US presidential candidate Robert F. Kennedy Jr. claimed that if elected president, he would sign an executive order requiring the US to buy 550 BTC per day to build a strategic reserve of 4 million BTC, and would direct the US Internal Revenue Service to issue public guidelines stipulating that all transactions between Bitcoin and the US dollar are non-reportable and tax-free.
Market Analysis
The Bitcoin daily chart, the trend line that extends from the beginning of June to the end of July, has been forming resistance, preventing the Bitcoin price from breaking through upwards. At the Bitcoin Conference 2024 on July 27, based on expectations that US presidential candidate Trump will make a positive speech about Bitcoin, the Bitcoin price reached $69,000 during the day, and the closing price fell to $67,900. The green zone provides short-term support, as there are 2 local bottoms within two weeks, and the range is between $63,800 and $65,400.
Source: Tradingview.com
Bitcoin’s monthly return historical data shows that, July was a month with more positive returns than negative returns. The opening price of Bitcoin on July 1 was $62,800, and it has now recorded a return of about 7%. As long as the Bitcoin price is higher than the opening price by the end of July, it will also be a positive return month.
However, the data from August and September in previous years revealed that negative returns outweighed positive returns, and investors should beware of the risk of market correction.
Source: Coinglass.com
Conclusion
With the listing of the Ethereum Spot ETF, the US presidential candidate Trump attending the Bitcoin Conference 2024 and making a number of remarks about the cryptocurrency industry if elected president, cryptocurrency has officially entered the mainstream of the US financial and political sector. The presidential election and the Federal Reserve’s interest rate cut are expected to be the most important factors affecting the price of Bitcoin in the second half of the year. Investors need to pay attention to the US macroeconomic, political and regulatory aspects other than the crypto market.
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