HTX DeepThink: CPI cooling strengthens rate cut expectations, crypto market rebounds strongly but short-term volatility risk rises
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HTX DeepThink: CPI cooling strengthens rate cut expectations, crypto market rebounds strongly but short-term volatility risk rises
HTX Research analyst Chloe (@ChloeTalk1) analyzed in the latest HTX DeepThink column that the April U.S. CPI data released on May 13 came in below expectations, reinforcing market expectations of Fed rate cuts this year. Meanwhile, driven by factors including a slowdown in the Fed's QT, fiscal funds flowing back during tax season, and money market fund flows out of the RRP, macro liquidity has seen a temporary release, leading to a clear rebound in crypto market capital and fueling strong gains in core crypto assets such as BTC, ETH, and SOL in May. Institutional capital continues to flow in, with BTC futures open interest (OI) remaining elevated—reaching 3.4% of spot circulating supply—and derivative markets for ETH and SOL also showing robust recovery. However, in the short term, high proportions of profit among BTC and ETH short-term holders, combined with concentrated leveraged positions in derivatives, could trigger cascading profit-taking and liquidations if prices break key technical levels, increasing the risk of market volatility.
Navigating Web3 tides with focused insightsTechFlow, on May 14, HTX Research analyst Chloe (@ChloeTalk1) analyzed in the latest edition of the HTX DeepThink column that the April U.S. CPI data released on May 13 came in below expectations, reinforcing market expectations for Fed rate cuts this year. Meanwhile, driven by factors such as slower Fed QT pace, fiscal fund repatriation during tax season, and money market fund outflows from the RRP, macro liquidity has seen a temporary release. This has led to clear capital inflows into the crypto market, fueling a strong rebound in major crypto assets such as BTC, ETH, and SOL in May. Institutional capital continues to flow in, with BTC futures open interest (OI) remaining high at 3.4% of spot circulating supply, while derivative markets for ETH and SOL are also showing strong recovery.
However, in the short term, BTC and ETH have a high proportion of profit among short-term holders, combined with concentrated leveraged positions in derivatives. If prices break through or fall below key technical levels, it could trigger chain reactions of mass profit-taking and liquidations, increasing the risk of market volatility.
