Pay attention to the interest rate meeting at the end of the month and the November tariffs. This week's focus is on the Federal Reserve's payment meeting (positive for the crypto sector) and CPI data.

Market expectations:

  • Stock market and gold: Global stock markets and gold (Xau) are trending upward, but U.S. stocks (Nas) have profit-taking risks.

  • U.S. Dollar (DXY): Reached resistance level, facing a reversal.

  • Crypto market (BTC/ETH): Bullish trend remains unchanged but is approaching resistance; significant upward movement is expected after short-term fluctuations at the end of the month.

Macro and market sentiment

External positive drivers: The market is closely watching the Federal Reserve's payment innovation meeting on October 21 (next Tuesday). The meeting will discuss stablecoins, artificial intelligence, and tokenization, which are seen as direct policy positives for the crypto sector and could serve as a catalyst for the next round of increases.

Macroeconomic uncertainty: The Fed's interest rate meeting at the end of the month and tariff issues on November 1 are potential market disturbance factors. Although the market generally expects a rate cut (current probability 98%), the CPI data forecast released on October 24 (Friday) is 3.1%, and higher-than-expected data may lower rate cut expectations, leading to market volatility. The market seems to prefer a divergent rate cut expectation rather than a one-sided bullish view.

Market structure health: The crypto market previously experienced a 'bloodbath' that cleared some leverage, reducing subsequent upward pressure.

Core asset analysis (BTC & ETH)

Bitcoin (BTC):

Trend: The overall bullish trend remains unchanged.

Short-term strategy: Expect the price to test near the previous high again, which is a key resistance/target area. From the current position, there is an expected upside of about 8%.

Technical signals: The 4-hour RSI indicator has reached the midline resistance level, which is a sign of an impending trend change, and there may be directional choices in the short term.

Position building and liquidation: The recent trend is likely to be mainly fluctuating, suitable for building positions on dips. Data shows that the main liquidation range is between $110,000 - $120,000, indicating that the market has accumulated significant liquidity below this range.

Ethereum (ETH):

Performance expectations: Performance may be stronger than Bitcoin. There is an expectation of breaking new highs, with a potential upside of about 14%.

Long-term target: Very optimistic about ETH's future, believing its price is expected to exceed $6000.

ETH/BTC exchange rate: Currently in an adjustment phase, expected to adjust for about 10 days, after which a breakout trading plan can be formulated, with the expectation that ETH will outperform BTC.

On-chain data: A significant on-chain activity of $123,500 has occurred, worth paying attention to.

Analysis of altcoins and market funds

Total market cap of altcoins (Total3): The previous upward trend has been broken, and the market needs time to recover. It is necessary to observe the recovery situation over the next 10 days to determine whether it is a good time to re-enter altcoins.

Total market cap excluding BTC (Total2): The trend is relatively strong, showing a significant rebound, and the price has broken through the key downtrend edge of $1.5 trillion. If the price can retest and consolidate above this level for a few days, it will be a positive signal for upward momentum.

Stablecoin market cap dominance (USDT.d): This is a key reverse indicator. Initially expected to rise starting in January next year (indicating a risk asset outflow), it now seems likely to occur by the end of this month. After about 10 days of adjustment, the possibility of USDT.d skyrocketing (i.e., the crypto market declining) by the end of the month is increasing.

Market dominance and correlated assets

Bitcoin market cap dominance (BTC.d): It is expected that the future will mainly be characterized by fluctuations, indicating that funds may not overly concentrate on Bitcoin, leaving room for the performance of ETH and altcoins.

MicroStrategy (MSTR): As a strongly correlated stock with Bitcoin, it is currently in a state of consolidation, with the market seemingly waiting for ETH to 'perform' first.

Summary and outlook

Short-term (next 1-2 weeks):

The market is on the eve of a trend change. On one hand, the Fed's payment meeting brings significant positive expectations; on the other hand, the 4-hour line of BTC signals a trend change, and USDT.d carries upward risks. The market is expected to fluctuate mainly, possibly in a phase of major players building positions and washing out. ETH's performance may be relatively strong.

Medium-term (end of the month to early November):

This is a decisive time window. CPI data, interest rate decisions, and tariff issues will come to a conclusion. If macro risks stabilize, combined with favorable payment meeting outcomes, the crypto market is likely to start a significant upward trend. However, one must also be cautious of the pullback risks brought by a premature rise in USDT.d.

Trading strategy suggestions:

Be patient: The short-term direction is unclear, avoid chasing highs, and consider building positions in batches during fluctuations.

Pay attention to ETH: A breakout in the ETH/BTC exchange rate will be an important signal, and ETH may be the next leader in this phase.

Keep an eye on key dates: Focus on market reactions next Tuesday (payment meeting) and Friday (CPI data).

Risk management: Given the potential risks of USDT.d, proper position management should be implemented.