QCP: The crypto market saw a strong rebound over the weekend, with the market focusing on this week's CPI data and institutional demand.

On August 11, QCP released its daily market observation, stating that "in the low liquidity weekend period, the crypto market rebounded strongly, with Bitcoin breaking through $122,000, approaching its historical high, completely recovering the losses from last week. Ethereum performed impressively, rising 21% in the past seven days, first breaking through $4,300, reaching a new high since 2021. Since mid-July, the correlation between Bitcoin and the stock market has significantly increased, thus today's outperformance in the crypto market aligns with the overall trend of rising risk appetite. The U.S. stock market rebounded close to historical highs after a brief pullback following last week's employment data, almost ignoring the impact of new tariffs and macro uncertainties. With strong bullish momentum, the market's short-term focus has shifted to the U.S. consumer price index (CPI) to be released on Tuesday. The market generally expects the annual inflation rate to rise by 10 basis points to 2.8%. If the data comes in lower than expected, it may further solidify the market's expectations for a Fed rate cut in September, especially after several Fed officials recently shifted from hawkish to dovish, making rate cuts almost a certainty. Whether this can lead to new highs for crypto assets remains to be seen. Conversely, if CPI data is on the high side, the upward trend may pause, and the crypto market will also adjust alongside the overall market. In this regard, some traders have begun to hedge event risks, with increased demand for Bitcoin put options in the $115,000 to $118,000 range to prevent unexpected declines. Such defensive operations coexist with top buying to cover call options. It is expected that front-end volatility will remain high before the data is released, and if Bitcoin fails to effectively break through resistance, volatility may narrow. As Bitcoin approaches historical highs, institutional demand and spot ETF fund inflows will become the focus. Prices are at a critical resistance zone, and there may be some profit-taking before the CPI release. However, the market has recently successfully digested the selling pressure from "old whales" without losing momentum, further supporting our structurally bullish judgment.