Matrixport Research: BTC is in an oversold state, and the dawn of a recovery market is approaching

Matrixport Research Institute's latest study indicates that,

• Risk assets continue to be influenced by macroeconomic factors, and inflation data may affect the recent market.
• During periods of high uncertainty, investing in options may balance asset allocation.
• The situation regarding the U.S. election remains unclear, and the realization of benefits is pending.

Risk assets continue to be influenced by macroeconomic factors, and inflation data may affect the recent market

Currently, the BTC price is in an oversold state, and historically, such situations have often led to a rebound. The upcoming inflation data may promote market optimism.

At present, risk assets are still significantly affected by macroeconomic factors, with recent concerns about economic growth and the job market becoming the main influencing factors. The U.S. will release inflation data next week, and if the inflation rate decreases, especially if it falls below 3.0%, traders are likely to respond positively, and BTC may see a recovery.

During periods of high uncertainty, investing in options may balance asset allocation

Matrix on Target also suggested last year investing in options with low price advantages during low volatility periods. Protecting a portfolio through cheap put options or buying call options with minimal risk capital can effectively reduce BTC exposure risk during uncertain times. Similar to last year, the actual volatility on the 30th has dropped to around 25% before significantly increasing.

In August, both trading volume and liquidity will decline, leading to lower returns. The 18% plunge observed on Monday also confirms the report from last week mentioning that "recently, Bitcoin prices have begun to lose momentum, and coupled with the upcoming weak period, the challenging trading environment may continue for several weeks."

The situation regarding the U.S. election remains unclear, and the realization of benefits is pending

From the current situation, Trump is likely to win the 2024 U.S. presidential election, but Harris's succession of Biden has dealt a blow to the Republican Party. Harris currently leads Trump in polls, and the transition on July 21 coincided with BTC's weak rebound, significantly affecting BTC traders.

Conclusion

Investors should closely monitor whether traders are attempting to bottom-fish. Last week, Circle stablecoin saw a significant outflow of funds, and this week’s large inflow may signal bottom-fishing. The Relative Strength Index (RSI) is at 30%, indicating a potential buying opportunity, similar to the situation in June 2024. In a BTC bull market, while consolidation may occur, situations where the RSI is below 30% are rare.

The above views are partly derived from Matrix on Target. Contact us for the complete report from Matrix on Target.

Disclaimer: The market carries risks, and investment should be approached with caution. This article does not constitute investment advice. Trading in digital assets may involve significant risks and volatility. Investment decisions should be made after careful consideration of personal circumstances and consultation with financial professionals. Matrixport is not responsible for any investment decisions made based on the information provided herein.