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TSLA $371.98 -1.59%
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CoinShares: Bitcoin shows resilience, but inflation pressure in the United States still limits market upside potential

CoinShares released a report indicating that Bitcoin has shown relative strength this week against the backdrop of renewed volatility in the risk asset market, primarily due to a rebound in spot buying, improved stock market sentiment, and some short covering. Overall, the market is gradually reducing its enthusiasm for the AI narrative and is instead focusing more on whether corporate earnings can meet expectations.The poor performance of some U.S. corporate earnings reports has triggered significant stock price fluctuations, which have also affected Bitcoin to some extent, but it still demonstrates strong resilience overall. Meanwhile, macroeconomic signals in the U.S. remain mixed, with the housing market continuing to weaken. In terms of interest rates, the market generally expects the Federal Reserve to maintain interest rates at the meeting on October 28. The market's expectations for another rate hike in December remain high, with the related probability close to 83%.The weakness in the housing market provides some room for the Federal Reserve to pause rate hikes, but last week's higher-than-expected Consumer Price Index (CPI) and Producer Price Index (PPI) data indicate that inflation remains a key factor limiting a shift in policy. If the Federal Reserve unexpectedly raises rates next week, it could trigger more pronounced financial market volatility due to exceeding market expectations; in contrast, maintaining interest rates and continuing to release hawkish signals would be easier for the market to digest. Overall, the current market remains in a state of intertwining bullish and bearish factors. Improved spot demand, Bitcoin's enhanced ability to withstand stock market volatility, and the cooling housing market all provide some support for the market; however, inflationary pressures have not yet dissipated, limiting the Federal Reserve's room to ease policy. The subsequent trend of Bitcoin is expected to remain highly influenced by interest rate expectations and the overall liquidity environment, with the importance of single industry or market catalysts being relatively limited.

Analysis: Brent crude oil continues to stay above 100 dollars, macro pressures may limit Bitcoin's upward potential

CryptoQuant analyst Darkfost stated that due to the ongoing tensions in the Gulf region and Ukraine's increased attacks on Russian refineries, Brent crude oil prices remain above $100 per barrel. The rise in oil prices is transmitting through the global economy, pushing up production, service, and commodity costs, further permeating inflationary pressures into the economic system, and potentially increasing the risk of economic slowdown, thereby limiting market liquidity, especially for funds flowing into high-risk assets like Bitcoin.Darkfost pointed out that from a long-term trend perspective, when Brent crude oil remains above the annual average and enters a strong upward trend, BTC tends to show slower performance; conversely, when oil prices drop significantly, BTC is more likely to experience a recovery. However, he emphasized that this does not mean there is a simple direct causal relationship between oil prices and BTC; what truly affects risk assets is the macroeconomic environment accompanying high oil prices. In July of this year, oil prices briefly retreated, providing BTC with an opportunity to rise, but Brent crude has since rebounded significantly. Although funds may still rotate between different markets, driving BTC to continue its upward trend, the current macro environment is not conducive to sustained new liquidity flowing into the market.
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