Markets are giving off different signals, and looking at a single indicator isn't enough to interpret them. Bitcoin lost its three-week winning streak and is struggling to hold around the $82,000 mark. Ethereum has fallen below $2,500. Stocks are trading near record highs. Gold is caught between central bank purchases and bond yields. Oil continues to stay above $100. Each asset is moving with its own dynamics, but they are all fueled by the same macroeconomic backdrop.

Crypto Side: ETF Outflows and the Support Battle

The crypto market was under significant pressure this week. $678.9 million flowed out of US spot Bitcoin ETFs during the week, more than offsetting the previous week's $241.1 million inflow. Ethereum ETFs experienced net outflows for nine consecutive days, totaling $542 million. This indicates a decrease in institutional investor risk appetite.

Bitcoin's price recovered after falling to $80,397, settling in the $82,000-$83,000 range. Analysts point to $84,400 as resistance, and a break above this level could bring $87,000 back into focus. On the downside, $81,000 is a critical support level. A drop below this could test levels below $80,000.

The picture is weaker for Ethereum. ETH fell below $2,500, losing its 50-day moving average. The $2,400 level stands out as a critical threshold for maintaining the uptrend. Analysts emphasize that ETH is a leading indicator for the crypto market and this break should be closely watched in terms of overall risk appetite.

Stocks: Record Highs and Narrowing Range

US stocks are trading near record highs, led by technology stocks. The S&P 500 finished the week up 0.9%, while the Nasdaq 100 closed near its record high. However, this rise is driven by a narrow group of stocks. While AI-related companies are pushing the index higher, market breadth remains weak. This raises questions about the robustness of the rally.

Gold: Between central bank purchases and yield pressure

Gold is trading in the $4,100-$4,200 range. The People's Bank of China continued its gold purchases for the 23rd consecutive month, expanding its reserves. This supports the price as a long-term source of demand. However, high bond yields are increasing the cost of holding non-yielding assets like gold. Analysts suggest that a drop below $4,100 could bring the $3,960-$4,000 range into play.

Oil: Supply concerns and geopolitical risks

Brent crude is trading at $104, while WTI is at $91. Tensions in the Middle East and disruptions in the Strait of Hormuz are keeping supply concerns alive. High energy prices are fueling inflation expectations, which in turn is affecting central bank interest rate policies.

Macro Outlook: Fed Expectations and Inflation

The Fed's September meeting minutes showed that a large majority of officials believe a rate hike by the end of the year might be more appropriate. However, the market expects a pause in October. According to CME data, the probability of rates remaining unchanged in October is over 82%, while the probability of a hike in December is 72.8%. The CPI data to be released on October 14th is the most important data point that will shape these expectations.

According to the New York Fed's consumer expectations survey, inflation expectations for one year ahead have risen to 3.9%. This is the highest level since May 2023. The expectation for three years ahead is 3.3%. These data show that inflation is not yet under control and the Fed may need to maintain its cautious stance.

What's on your radar?

The market is currently searching for direction. On the crypto side, ETF outflows and support levels will be decisive. Whether record highs in equities are sustainable depends on market breadth. Gold is caught between central bank purchases and yield pressure. Oil is sensitive to geopolitical developments. And all these assets will be shaped by the CPI data on October 14th and expectations regarding the Fed's interest rate path.

This article is not investment advice. The analysis is based on publicly available information and does not guarantee future results.

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