Week-over-week performance:
- BTCUSD: 118,941 / +3.93%
- ETHUSD: 4,291 / +17.37%
- US10Y: 4.285% / +2.02%
- DXY: 98.53 / -0.32%
- GOLD: 3,348 / -0.65%
- SPX: 6,373 / +0.70%
- NDX: 23,526 / +1.46%
- VIX: 16.25 / -7.30%
Looking ahead – economic calendar:
- Tuesday, 12 August 2025: US CPI.
- Thursday, 14 August 2025: EU GDP, US Initial Jobless Claims, US PPI.
- Friday 15 August 2025: US Core Retail Sales, US GDPNow, US UMich Inflation Expectations.
On the macro side:
After last week’s negative job market data, the market increased the probability of a September rate cut, with an 84.5% chance priced in. This week’s CPI, PPI, and Thursday’s initial jobless claims will be key in shaping the Fed’s decision. Lower-than-expected CPI and PPI would reinforce rate cut expectations, benefiting growth assets like crypto. Weaker jobless claims could signal economic weakness, prompting a risk-off move.
The U.S. Dollar (DXY) has been trending upward since July. A stronger dollar could benefit European investors by boosting the value of their foreign investments in crypto and equities, but may hurt U.S. exporters due to concerns over earnings.
Additionally, President Trump signed an order on 11 August extending the U.S.-China tariff truce for 90 days, easing potential pressure on the markets.
With inflation data, employment figures, the dollar’s performance, and trade developments in play, the incoming week will be critical for market sentiment. If the data deviates from expectations, it could lead to heightened volatility across risk assets like crypto and equities.
On the crypto side:
Last week, President Trump signed an executive order allowing 401(k) retirement plans to invest in crypto. These plans manage USD 12 trillion in assets, with USD 50 billion in new capital flowing in every two weeks. Even a small allocation towards crypto could inject a significant amount into the crypto space, driving substantial market growth.
A key highlight of the week was the massive inflow of over USD 1 billion into ETH ETFs on Monday 11th, which accounts for about 10% of total historical inflows. Historically, BTC ETFs have seen USD 54 billion in inflows, while ETH ETFs have seen USD 10 billion, creating a ratio of about 6:1. However, the market price ratio of ETH/BTC is around 28:1, with the current ETH/BTC price at 0.036 (30-50% lower than levels seen last year). This disparity suggests that institutions may be betting on a potential rally in the ETH/BTC ratio.
Looking beyond ETH, Solana (SOL) is still 70% below its all-time high, presenting a potential opportunity for growth once ETH leads the market higher. SOL could emerge as a secondary player in the mid-term as investors seek additional growth beyond ETH.
For short-term traders, high-beta ETH tokens could provide a good opportunity to capitalize on market volatility, offering higher returns for those looking to take advantage of the potential rally.
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