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Yesterday's results on lower inflation in the U.S. brought positive news to the market, thereby giving buyers the momentum to reach $24,750. Now we need to continue to consolidate above the level of $24,300-$24,400 to follow the uptrend to $28,000-30,000. Resistance blocks are at the $24,600 and $25,600 price levels.
So what could be the trigger for markets, especially crypto, this time around? The same inflation, but this time producer's, as well as BlackRock's initiative to create a private BTC trust for its institutional clients.
Producer price index (PPI) decreasing
U.S. producer price index (PPI) fell to 9.8% in July from 11.3% a month earlier. The index came in below expectations of 10.4%. The markets barely reacted to the data, which is logical after yesterday's positive sentiment around the strong slowdown in consumer inflation.
Nonetheless, as analysts noted after the PPI report, the markets' implied probability of a 0.5% Fed rate hike in September rose to 70%, and the probability of a 0.75% hike continues to fall rapidly. A reduction in the size of the Fed's rate hikes can significantly improve the situation on financial markets, especially risky ones such as crypto.
BlackRock initiative
A week after the partnership with Coinbase became known, BlackRock announced the launch of a trust fund focused on BTC. The trust is intended to be available to U.S. institutional clients and will be BlackRock's first product to offer direct access to Bitcoin - but only through the spot market.
Given the $10 trillion under BlackRock's management, as well as the speed of the company's decisions regarding crypto, the degree of seriousness of such initiatives is beyond doubt. Who knows, maybe at least $1 out of $10 trillion will stick to crypto market capitalization, which at its peak was estimated at $3 trillion.
Yuri Molchan
Alex Dovbnya
