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Crypto cools off despite Asia stock rally – Is U.S. inflation the next shock?
Despite a strong rally across Asian equity markets, the crypto sector has failed to gain traction, with major digital assets struggling to maintain their upward momentum. The recent sentiment shift indicates growing caution among traders as they await key U.S. economic data, which could potentially reshape risk appetite and create significant market volatility.
The global market indices have begun the week on a strong note, fueled by an Asian equity rally that pushed world indices to new record highs. Japan’s Nikkei climbed almost 1%, while China’s CSI300 and Shanghai Composite saw modest gains. The surge in optimism surrounding potential trade progress could potentially sustain momentum, despite ongoing policy concerns.
In stark contrast, crypto derivatives reveal a different narrative. According to Coinglass data, Bitcoin’s Open Interest (OI) has fallen from late-May highs of over $120 billion to just above $100 billion as its price hovered near $107K at the time of writing. This decline in Futures Volume and OI serves as a warning sign of reduced trader conviction and fewer leveraged bets on directional movement.
Meanwhile, liquidation data reveals an astonishing $21.75 million worth of Bitcoin liquidations, surpassed by Ethereum’s staggering $35.63 million. Solana saw $5.42 million wiped out, while Ripple’s losses totaled $5.13 million. The current low-volume environment could set the stage for heightened volatility once macro catalysts emerge.
This week will be marked by numerous market-moving events, with U.S. inflation data potentially being the most significant shock yet. With CPI scheduled for June 11th and PPI on the 12th, traders are bracing themselves for increased risk in assets. The potential for a hotter-than-expected inflation report could fuel concerns about extended Federal Reserve hawkishness, putting pressure on equities and crypto alike.
The hesitation displayed by the crypto market suggests that investors have already factored in turbulence, perhaps preparing for impact.
Source: ambcrypto.com
