Global Market Dynamics: The unexpected decline in the US PPI strengthens rate cut expectations, the Bitcoin "whipsaw" pattern may trigger a new round of bull run.

On Wednesday, Wall Street stocks rebounded to new highs, driving Asian stock markets to open mixed on Thursday. Previously, the U.S. Producer Price Index (PPI) unexpectedly fell, supporting market bets on the Fed resuming interest rate cuts next week. Meanwhile, Bitcoin price rebounded at the 110,000 support level, with an analyst pointing out that its weekly chart is forming a historic "whipsaw" pattern, which could signal the arrival of the next bull run, with a target price potentially exceeding 130,000.

Macroeconomic Market Overview: PPI Unexpectedly Declines Boosting Rate Cut Expectations

Stock market performance: Overnight, after the release of PPI data, the S&P 500 index in the U.S. rose 0.3% and hit a new high, while the Nasdaq 100 index also saw a slight increase. On Thursday, Asian stock markets showed mixed performance, with the Japanese stock market rising slightly, the Korean Kospi index reaching a new high, while the Australian stock market declined.

Interest rate cut bets heat up: In August, the U.S. Producer Price Index (PPI) unexpectedly declined by 0.1% month-on-month, marking the first decrease in four months. This eased market concerns over high inflation and bolstered confidence in the Fed's potential interest rate cut next week. The market widely anticipates a 25 basis point cut, but some analysts believe that if the Consumer Price Index (CPI) data released on Thursday falls short of expectations, the Fed may consider a more aggressive 50 basis point cut.

Other market dynamics: Alibaba Group announced plans to raise $3.17 billion through the issuance of zero-coupon convertible bonds, with its US ADR falling 2.2%. Additionally, leaders from the US and India have pledged to resume trade negotiations, while Mexico is considering imposing tariffs of up to 50% on cars and steel from countries such as China.

Bitcoin Price Analysis: Historic "Whipsaw" Pattern Signals a New Bull Run

(Source: TradingView)

Price Trend: Bitcoin has rebounded at the support level of 110,000 USD and is currently trading above 112,000 USD, experiencing significant volatility in the past 24 hours.

"Whipsaw" pattern: Cryptocurrency analyst CrypFlow pointed out that Bitcoin's weekly chart is showing a historic "Whipsaw" pattern. Since the cycle bottom in 2022, this pattern (the purple circle on the chart) has always appeared before a strong bullish run, as it "washes out" weak investors through brief and severe declines, laying the groundwork for the next rise (the green box).

Potential rise target: The analyst believes that the current "Whipsaw" pattern may signal the start of a new round of Bitcoin's rise, with prices likely to test its historical high of $124,128 again and possibly break through $130,000.

Technical indicators support: On the weekly chart, the Stochastic RSI has fallen to oversold levels and is about to form a bullish crossover, which could provide momentum for Bitcoin's next rise.

Conclusion

The U.S. economic data and the outlook for Fed policy are the core driving forces of the current global market, and the upcoming CPI data will provide the next crucial clue for the market direction. In this context, the bullish technical pattern of Bitcoin stands out particularly. Although the PPI data has paved the way for interest rate cuts, the market still requires more evidence to be convinced that the Fed will continue its loose policy. The upcoming CPI data and Fed meeting will be critical moments to determine whether the technical analysis predictions for Bitcoin can be realized.