Crypto market observations for the week (July 7-13): The reciprocal tariff war has made great progress, both buying and selling are booming, and BTC consolidates and accumulates strength to rise sligh
Author: 0xBrooker
BTC daily trend
BTC opened at $117315.68 this week and closed at $117312.70, up 1.84%, with a high of $120300.00 and a low of $114750.00, an amplitude of 4.73%, and a high trading volume.
The US economy and data released this week maintained the expectation of a rate cut in September, but the probability of a rate cut is only 64.5%. Due to the deadline for the tariff war on August 1, long-term investors continued to sell at the key point of $120,000 to realize profits. The buying power from corporate purchases and BTC Spot ETF absorbed all the selling pressure, showing a trend of strong buying and selling.
As BTC consolidated at a high level, ETH, which rose 26.4% last week, rose slightly by 3.07% at a high level, supporting Altseason expectations. Most small-cap Altcoins fell, but high-quality projects remained strong, pushing BTC's market share down slightly to 60%.
Excluding the expectation of a rate cut, the factor that has the greatest impact on the market - the reciprocal tariff war, also made further progress this week. Japan and the European Union both signed a 15% tariff increase, which was in line with market expectations overall, and U.S. stocks responded with an increase.
Policies, macro-finance and economic data
After the CPI data released last week met expectations, the number of initial jobless claims released by the United States on Thursday was 217,000, lower than the expected 22.6 and the previous value of 22.1, which once again showed the resilience of the US economy and also temporarily reduced the expectation of a rate cut in September.
The initial value of the US S&P Global Manufacturing PMI for July released on the same day was 49.5, lower than the expected 52.7 and the previous value of 52.9, which provided slight positive support for the rate cut.
US President Trump rarely went to the Federal Reserve to "hold the palace accountable", but was met with a cold and violent counterattack from Chairman Powell. As the Federal Reserve has been divided on whether to cut interest rates or not, the interest rate meeting on July 31 has become more confusing, but the market generally believes that the probability of a rate cut in July is very low and has already priced it in.
The third phase (signing) of the reciprocal tariff war also made clear progress this week.
The United States and Japan reached an agreement - Japanese goods exported to the United States will be subject to a unified 15% "reciprocal tariff" (significantly lower than the previously announced 25%~35%), Japan will invest $500 billion in the United States in the next 10 years, and agree to further open up automobile and agricultural import quotas. 15% tax rate + investment and US goods imports, lower than market expectations, the Nikkei index rose 4.1% this week.
The United States and the European Union reached an agreement - the European Union's exports to the United States (including automobiles) are subject to a 15% tariff, while the United States enjoys a 0% tariff on EU exports. The European Union promised to invest an additional $600 billion in the United States, purchase $750 billion in US energy products (mainly liquefied natural gas), and purchase a large number of US military equipment.
On July 25, the White House updated the draft of the Reciprocal Tariff Act, generally raising tariffs to 12%, while retaining the highest additional tariff range of 70%, and announced that it would send letters to about 150 trading partners before August 1 to confirm the final tariff rate.
Although major trading countries such as China, Canada, and Mexico have not yet signed a final agreement, the market generally believes that the tariff war has come to an end, and the impact on the market has given way to economic and employment data, as well as expectations of interest rate cuts.
Under the resilience of the US economy and expectations of AI spending, most of the performance of companies announced in the US Q2 earnings season exceeded expectations, which also gave funds the confidence to continue to go long at high levels. The three major US stock indexes moved steadily this week, with the Nasdaq, S&P 500 and Dow Jones recording increases of 1.02%, 1.46% and 1.26% respectively.
EMC Labs believes that the opening of the interest rate cut cycle, the end of the tariff war, and AI-driven growth in US corporate performance are the psychological support for US stocks to set new highs at high valuations. Similarly, the twists and turns and downward adjustments of these three expectations will also form downward pricing momentum for US stocks and BTC. However, the market's systemic risks have been basically eliminated, and a new economic cycle is about to begin.
Crypto Market
This week, BTC fluctuated between $115,000 and $120,000, with the 5-day and 10-day lines sticking together, and briefly stepped back on the 20-day moving average.
In previous reports, we pointed out that BTC has started the fourth wave of this cycle, but after challenging $120,000, it returned to a volatile trend. The reason is that after a sharp rise in early July, the long-term momentum weakened under the uncertainty of the tariff war on August 1, coupled with the continuous selling of long hands, resulting in a pause in the rise.
Long-handed reductions may not be all negative. Whether in the off-market or on-market, we have noticed that funds are rapidly flowing into Altcoins led by ETH.
The Crypto market is in a period of style conversion within the cycle, marked by the reversal of the ETH/BTC trading pair. Since then, BTC's rise has come more from corporate procurement and the inflow of funds from the BTC Spot ETF channel.
Fund Inflow and Outflow and Selling
The fourth wave of rising started, and long-term investors started to sell on a large scale again. The scale of selling exceeded 190,000 coins in the past three weeks, which slowed down the destocking of centralized exchanges.
Especially the awakening and selling of ancient whales, which put great psychological pressure on the market. In the case of insufficient buying power in the market, the strong buying power outside the market has provided strong support for the BTC price.
This week, the scale of capital inflow in the whole market reached 6.002 billion US dollars, including 3.192 billion in the stablecoin channel, 702 million in the BTC Spot ETF channel, 898 million in corporate purchases, and 1.842 billion in the ETH Spot ETF channel, which once again exceeded the buying power of the BTC Spot ETF.
Two changes that have occurred in the OTC market are that corporate purchases have become the main buying force, and there are signs that ETF channel funds have shifted from BTC to ETH. These two changes deserve high attention.
Cycle Metrics
According to eMerge Engine, the EMC BTC Cycle Metrics indicator is 0.5, which is in an upward period.
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