Wintermute: The crypto market showed relatively strong performance this week, but the upward trend has not yet been confirmed

BlockBeats report, July 22, Wintermute released a market analysis stating that in June, US CPI fell 0.4% month-over-month, the largest single-month drop since April 2020. Overall inflation eased from 4.2% to 3.5%, below market expectations of 3.8%. The market has already priced out the possibility of a Fed rate hike in July, but renewed US actions against Iran and the reopening of port blockades have boosted Brent crude oil, which rose 15.54% over the week. Risk assets showed clear divergence: ETH rose 3.64%, BTC rose 1.46%, and the Nasdaq index fell 4.16%.

After the US CPI release, Bitcoin briefly jumped from about $62,000 to $64,900. ETH rose as much as 7% to $1,884. In about one hour, roughly $134 million of short positions were liquidated. US Bitcoin spot ETFs saw a total net inflow of about $191 million on Tuesday and Wednesday, ending 10 consecutive days of outflows. However, compared with the record $4.5 billion net outflow in June, the current inflow size is still not enough to confirm a trend. Bitcoin held its post-CPI gains during the selloff in chip stocks, suggesting the crypto market structure is repairing, but a definite uptrend has not yet formed.

Wintermute believes that if ETFs continue to maintain net inflows for a full week, and Bitcoin stays above $66,000 for several trading days, the market relative strength signal will be confirmed. If Brent crude breaks above $90 or the Strait of Hormuz is officially closed, this assessment may become invalid.