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Cryptocurrencies surged strongly over the weekend, with Bitcoin bouncing off key support at $118,400 and pushing toward all-time highs near $122,000. Ethereum led altcoins higher, breaking above $4,300, highlighting crypto’s advantage in trading 24/7 and capitalizing on sentiment shifts outside traditional market hours.

Meanwhile, global equity markets are entering a seasonally weak period, with the MSCI All-Country World Index historically showing losses in August and September.

Here’s what we’ll cover today:

Let’s get into it.

Cryptocurrencies saw a broad surge this weekend as bitcoin rose sharply, approaching all-time highs after bouncing off our $118,400 key level. Ethereum emerged as the clear leader in the rally, posting impressive gains that pushed prices above $4,300. The weekend timing of this surge also highlights the 24/7 nature of crypto markets, allowing them to capitalize on sentiment shifts when traditional markets are closed.

While crypto has been pushing higher, global equity markets are entering a seasonally weak period. Over the past decade, the MSCI All-Country World Index has averaged losses in both August and September, with August slipping around 0.5% on average and September posting deeper declines of roughly 2%. Even in strong bull markets, being mindful of these patterns can help traders tactically manage risk and preserve gains.

This week’s key macro event will be Thursday’s release of July’s U.S. Core Consumer Price Index (CPI). Economists are expecting a 0.3% month-over-month increase and a 3.3% year-over-year rise, the highest monthly core CPI reading so far in 2025. While this uptick is not being interpreted as a renewed inflation threat, it does represent a modest firming after several months of softer data.

The 5-year/5-year inflation breakeven rate jumped to 2.45% following last week’s stronger-than-expected employment report, its highest level of this cycle. This move signals that markets are starting to question whether the disinflation trend can persist.

We remain constructive on Bitcoin and the broader crypto ecosystem, while keeping a bearish stance on the U.S. dollar as monetary policy normalization approaches. With traditional safe havens under pressure, the setup continues to favor alternative assets, and we see opportunities for those positioned ahead of the crowd.

With Bitcoin moving toward all-time highs again and various altcoins shooting higher as well, the crypto fear and greed index has risen too, currently sitting in greed territory at a reading of 69. Note that this is not necessarily concerning as it has not yet moved into extreme greed levels, and even when it does, historical bull markets have shown the fear and greed index can remain in extreme valuations for weeks before significant corrections occur. Once it crosses into extreme greed, it makes sense to be cautious, but for now, this reading is not yet alarming.

This allows us to maintain a bullish outlook on crypto and other risk assets despite the current rally, and we expect bullish momentum to persist.

Total Bitcoin Spot ETF flows closed last week strong, with the highest inflows on Friday, something we wanted to see and elaborated on in Friday’s crypto report. This is a bullish signal as well, showing clear demand from traditional finance ahead of the weekend rally. We’d like to see inflows continue at the start of the week, rather than profit-taking, to keep the current rally going.

The most critical events for crypto this week are Tuesday’s CPI inflation data and Thursday’s PPI inflation and unemployment claims, as they will provide insight into inflation trends and labor market health. Friday’s data on U.S. Retail Sales, UMich Consumer Sentiment, and UMich Inflation Expectations will further inform consumer behavior and inflation outlook. While no central bank decisions are scheduled, these releases will influence Federal Reserve expectations and market risk sentiment.

What to watch in Tuesday’s CPI data:

Thursday’s PPI and unemployment claims will offer complementary data points on inflation dynamics and labor market resilience, key factors for Fed policy outlook and risk appetite.

Friday’s Retail Sales and Michigan consumer surveys will provide additional insight into consumer spending and confidence, which are crucial for assessing economic momentum and inflation pressures.

Crypto investors should closely monitor these indicators this week, as they will shape market volatility and help identify potential opportunities and risks going forward.

Bitcoin quickly reclaimed both key levels of $116,900 and $118,400, with price following through after a retest and pushing higher toward all-time highs again, currently trading just below $122,000.

The two-week Bitcoin liquidation heatmap clearly shows all leveraged liquidations taken out at the $120,000 level, followed by price shooting higher. For now, liquidity appears very thin, with a notable cluster of leveraged liquidations on the downside around $111,700 and $115,500. While this doesn’t necessarily mean price will fall back to those levels, it could indicate the potential for smaller pullbacks.

Bullish Scenario
In the bullish case, we want to see Bitcoin show strength here and trend higher, ideally moving into fresh all-time high territory and entering price discovery again. If price pulls back, $118,400 and $116,900 serve as initial support levels offering renewed long opportunities targeting all-time highs again.

Bearish Scenario
In the bearish case, Bitcoin fails to trend higher and faces rejection once more. Short opportunities may emerge on a successful bearish retest of $112,700, targeting $118,300, with invalidation if price reclaims the entry level.

With Bitcoin trending higher, the TOTAL3, our measure of the collective altcoin market, also managed to move up, currently fighting to reclaim the important $1.05 trillion mark, with the next target being $1.13 T. This shows that altcoins as a whole still lag behind Bitcoin but remain closely correlated. At this stage in the cycle, it’s crucial to focus on risk-adjusted bets and coins with relatively low downside potential.

A prime example is Ethereum. As the largest market cap altcoin, it carries among the lowest fundamental risks yet has led the altcoin market by not only outperforming its Bitcoin pair but also outperforming the broader altcoin market. It’s important to evaluate assets against both their BTC and OTHERS pairs to assess relative strength and risk-reward opportunities.

For now, we continue to focus on high-cap, established bets before a rotation into lower caps takes place later in the cycle.

We hope this report provided you with valuable insights into the latest market developments and geopolitical shifts.

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As always, stay informed, stay prepared, and have a fantastic week ahead! 🚀

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