- Coinbase predicts a positive market shift and warns about the impact of the US CPI.
- QCP Capital supported the bullish outlook for BTC.
According to Coinbase analysts, the crypto market could expand its short-term recovery after a massive liquidation scenario after Bitcoin’s [BTC] dive to $49k on August 5.
According to the analysts’ weekly commentary, the plunge has wiped out long positions, causing a ‘cleaner positioning‘ that could stimulate the market.
“Cleaner positioning could be a positive technical indicator for crypto in our view… This could indicate that the market is done pricing in pessimism.”
At the time of writing, traders’ sentiments in the futures market have turned positive, as evidenced by positive funding rates. This also coincided with BTC’s recovery from $49,000 to the previous low of $60,000.
Source: CryptoQuant
The same bullish outlook was echoed by QCP Capital analysts over their weekend short.
‘The bullishness in BTC is significant and structural. Throughout the week (and despite the crazy volatility), there was consistent demand for BTC calls expiring in 2025, with strikes closer to 100,000.”
US CPI Data to Determine Next BTC Direction?
While Coinbase analysts acknowledged that the short-term price action for BTC, Ethereum [ETH]and Solana [SOL] could continue.
But macro factors would determine investors’ next move. They cited US CPI (Consumer Price Index) data, due to be released on August 14, as a key factor to watch.
‘We expect some of this selling pressure to ease… We think macro dominance could continue. For example, next week’s inflation print on August 14 will likely receive additional attention given this week’s events.
However, Coinbase added that traders and investors could start positioning accordingly using PPI (Producer Price Index) data to gauge the possible outcomes of the CPI. PPI data tracks inflation from the perspective of producers.
On the other hand, the CPI measures inflation by tracking consumer spending on major goods and services. The Fed uses both data sets to make interest rate decisions. The PPI data will be published on August 13.
‘But we also expect that many market players will look at the PPI the day before to provide an early indication of the direction of the CPI, which may also influence market performance.’
In short, a new round of market volatility should be expected from August 13, which will determine the next BTC and market direction for the week.
Over the weekend, BTC traded above $60,000, while ETH traded hands above $2,500. On the other hand, SOL was trading above $150.