Wintermute: Bitcoin's rise is more in line with the characteristics of a "relief rally" rather than the start of a new bull market.

BlockBeats news, July 7 — Wintermute released a market analysis stating that the latest U.S. nonfarm payroll employment data came in far below market expectations, and that Warsh’s remarks were interpreted by the market as somewhat dovish, driving a broad rebound in global risk assets, with the crypto market showing the strongest performance. Bitcoin and Ethereum have both recently significantly outperformed the S&P 500 and Nasdaq indices. The foundation for Bitcoin’s current round of upside is more solid, mainly driven by whales’ continued accumulation, Bitcoin option fund flows toward call options, on-chain data improvements, and the end of net outflows from Bitcoin spot ETFs, which has also provided a boost to market sentiment.

The cooling of the U.S. labor market has led the market to further reduce expectations for rate hikes within the year, and Warsh’s reiteration of the 2% inflation target at the Sintra Forum without releasing a more hawkish signal has been interpreted by investors as the Fed’s policy stance becoming more moderate. In the crypto market, Bitcoin on-chain data shows that the whale wallet accumulation near the 200-week moving average has totaled more than 270,000 BTC, while, in the same period, option market funds have also shifted from risk-avoidance positions to call options with strike prices of $60,000 to $70,000. Meanwhile, Ethereum’s rise has been driven more by institutional narratives, including the official launch of Ethereum Institutional and the continued advancement of institutional tokenization infrastructure. However, recent layoffs of about 20% at the Ethereum Foundation, budget cuts of about 40%, and earlier ETH ETF outflows still indicate that some pressure remains in its fundamentals.

This rally is more consistent with the characteristics of a “relief rally” rather than the start of a new long-term bull market. Improvements in the macro environment, easing tensions in the Middle East, continued institutional positioning in Ethereum, and low summer liquidity have all contributed to the market’s recovery. But from a capital-flow perspective, the cumulative net outflows from Bitcoin spot ETFs over the year are still as high as approximately $2.73 billion. Until ETF fund flows continue to improve and establish a trend, the market should still treat the current move as a recovery in sentiment rather than a structural reversal, and remain cautious about prospects ahead.