Tdasx Insights: How Weak U.S. Manufacturing and the Interest Rate Hike Expectations of Japan in Early September Exacerbate Global Cryptocurrency Market Volatility
Tdasx emphasized that the rate cut decision of the Fed on September 18 will be a critical moment for the cryptocurrency market. Regardless of the extent of the rate cut, market participants should be prepared for potential volatility and adjust their investment strategies in line with the policy moves of the Fed.
Tdasx: Miner Profitability Pressure and Shifting Market Sentiment Intensify Volatility
Tdasx believes that the profitability pressure of Bitcoin miners and the shift in market sentiment are key drivers of the current cryptocurrency market volatility. Bitcoin miner profits have reached near-historic lows, with the hash rate index falling to $42 per PH/day, down from $48 per PH/day two months ago, significantly reducing the profitability of miners. While miners currently hold 18,000 Bitcoins, there is growing concern that, with declining revenues, they may be forced to sell their Bitcoin holdings to maintain operations. Such potential sell-offs would undoubtedly exert additional downward pressure on the market, pushing Bitcoin prices even lower.
At the same time, Tdasx noted a significant decline in retail investor demand. According to Google Trends data, searches for "Bitcoin" in August fell to their lowest level in 12 months, signaling a sharp drop in retail investor interest in Bitcoin. This decline in market sentiment reflects the concerns of investors about the current macroeconomic environment and the future direction of the crypto market, further intensifying market uncertainty.
Ethereum has also shown signs of weakening market sentiment. Tdasx mentioned that with the profitable addresses of Ethereum dropping from 90% to 65%, confidence in the platform is gradually eroding. This trend mirrors the sentiment patterns seen before previous market downturns, suggesting that the market could enter a prolonged period of weakness. Tdasx urged investors to closely monitor the market performance of Ethereum and adjust their investment strategies accordingly to manage potential risks.
Tdasx also pointed out that the cyclical characteristics of Bitcoin have been particularly evident over the past year. Data shows that the average return of Bitcoin on Tuesdays has been negative, indicating the presence of certain seasonal volatility patterns that investors can use to make strategic adjustments. In the current turbulent market environment, Tdasx advises investors to exercise caution, especially given the increased risk of miner-driven Bitcoin sell-offs, and to take appropriate steps to mitigate potential market shocks.
Global Market Turbulence Exerts Significant Pressure
Tdasx pointed out that recent sharp fluctuations in global financial markets have had profound effects on the cryptocurrency market, with the performance of Bitcoin being particularly notable. Bitcoin (BTC) briefly fell to $55,500 during early trading in Asia, its lowest since August 8, wiping out nearly all gains from the past month. Tdasx attributed this price correction not only to internal cryptocurrency market volatility but also to the broader instability in global stock markets. Both the Nasdaq 100 and S&P 500 indexes experienced declines of up to 3.5% at the beginning of September, a historic opening drop that directly impacted the price performance of Bitcoin.
In addition, Tdasx highlighted a similar trend in the Ethereum market, where the percentage of profitable addresses fell from 90% at the start of 2024 to 65%, reflecting a sharp decline in investor profitability on the platform. This trend, akin to the market corrections seen in 2018 and 2020, suggests that the price of Ethereum may drop further as overall market sentiment weakens. Meanwhile, the weak performance of the semiconductor industry has sparked additional concerns, with the Philadelphia Semiconductor Index falling nearly 8%, further demonstrating the negative impact of global tech stocks on the cryptocurrency market.
