This is not a market giving up – it is a market catching its breath.
From macro to flows, from fiscal liquidity to structural rotation, the message this week has been consistent: ETH is back in vogue after many months of feeling unloved and under-owned. And with the dollar softening, central banks holding, and trade tensions easing, the macro backdrop continues to support broader risk appetite.
Macro: Trade Deals, ECB Patience, and Dollar Drift
Global risk assets were lifted this week by signs of trade détente, with a U.S.–Japan agreement confirmed and reports of a U.S.–EU deal in the works, potentially establishing a 15% baseline tariff with exemptions. Equities responded with fresh record highs with the S&P 500 and Nasdaq rallying, and the U.S. Dollar Index dipped, reflecting a more cooperative geopolitical tone.
In Europe, the ECB paused for the first time this year, holding rates at 2% after four consecutive cuts. With inflation still uncertain and ongoing trade tensions, they are clearly in wait-and-see territory now. The ECB’s walking a fine line: they do not want to overtighten financial conditions via a too-strong euro, but they also do not have the macro cover to go back to aggressive cutting just yet. The euro has hit a three-year high against the dollar, with spot probing just below 1.1750 at the time of writing. But at these levels I am not convinced the rally has much more room to run – a pullback toward the low 1.17s into the weekend would not surprise me.
Meanwhile, President Trump’s continued attacks on Fed Chair Powell underscore the political fragility surrounding U.S. monetary policy and with that Fed independence. But Powell remains – for now. If Trump’s recent visit to the Fed renovation site is anything to go by, his patience is wearing thinner than the Fed’s drywall. The spat is starting to look less like a policy disagreement and more like a reality TV feud. Who gets fired first – Powell or the contractor?
Across the board, global liquidity remains supportive. With the dollar weakening and fiscal issuance continuing, financial conditions are easier than the optics suggest. For crypto, that is still a tailwind.
Crypto: ETHereal Heights?
Despite the sell-off in the last few days, ETH is staying resilient, with ETH still up just shy of 4% on the week and now consolidating above USD 3,600. But structurally, nothing has changed – if anything, conviction is deepening.
ETH spot ETF inflows have now topped over USD 4 billion in July alone with ETH ETF inflows even outpacing those of BTC couple of days last week.
The fundamentals are stacking:
- ETH is the core infrastructure for stablecoins. The recently approved GENIUS Act provides long-awaited regulatory clarity to the space.
- Treasuries are building ETH positions (e.g Bitmine and Sharplink) much like Metaplanet and Strategy are accumulating BTC.
Meanwhile, altcoins suffered from broad-based double digit sell-off amid profit taking. This looks more like a post-runoff rotation than a trend reversal, and we remain of the opinion that altseason is still in play.
Looking Ahead: ETH takes the lead
BTC may have broken new ground last week, but it is ETH that still has altitude to gain. At ~USD 3,600, ETH remains more than 30% below its all-time high – yet the setup feels anything but laggard. Volume is building, flows are sticky, and conviction is rising. It is not a question of if ETH reclaims its all-time high, but when.
Macro tailwinds have not gone anywhere. Inflation is cooling, fiscal policy remains expansionary, and liquidity – not headlines – is steering the ship. With ETF inflows accelerating and ETH’s role as infrastructure increasingly clear, it’s well positioned to lead the next leg higher.
The technicals show room. The fundamentals make the case. And the flows are already paving the path.
This is not catch-up. It is momentum in motion.
Yes, we are in a pullback the last couple of days. But if this is what selling looks like in a bull market with strong ETH ETF inflows and corporate demand still rising then it is less a red flag, and more a pause before the next leg.
The destination has not changed. The route just got a bit more scenic.
Happy Trading!
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