CPI report eve: Bitcoin stabilizes around $108,000, hope for easing in the China-U.S. trade war rekindled!

The crypto assets market entered a “wait mode” this week, with Bitcoin relatively stable around $108,164, as the market holds its breath for the key US inflation (CPI) report due Friday. Analysis firm QCP Capital describes the current state as a “narrow equilibrium,” believing that the CPI data is the “single anchor point” for policy expectations and risk sentiment. Meanwhile, President Trump has softened his stance on tariffs with China, rekindling hopes of easing in the US-China trade war, with the prediction market estimating the probability of a tariff agreement has risen to 77%, adding a complex layer of optimism to the market.

Macro Focus: The CPI report is the “single anchor point” for the short-term market.

Due to the government shutdown, the CPI report on Friday has become the only major economic data release in the U.S. this week unaffected, thus receiving extremely high attention from the market.

· The market has entered a waiting mode: Bitcoin prices remain relatively stable around $108,164, while Ethereum trades around $3,815. This state of stability has been described by QCP Capital as a “narrow equilibrium,” which is a calm period before a potential storm.

· Importance of the CPI Report: The CPI report is considered a “single anchor” for policy expectations and broader risk sentiment.

· Support for the “soft landing” narrative: QCP points out that lower-than-expected CPI data may “re-anchor the soft landing trade,” providing support for Bitcoin as expectations for monetary policy easing improve.

· Key support and potential targets: Analyst Geoff Kendrick from Standard Chartered believes that falling below $100,000 could be the “last buying opportunity.” However, he predicts that Bitcoin will inevitably drop below six figures, which is an unpopular forecast during the historically bullish “Uptober.”

Optimism Under the Shadow of Trade War: A Turning Point in Sino-US Relations

The dynamic changes in the China-US trade dispute have brought new uncertainty and hope to the crypto market, and the data from the prediction market reflects a significant improvement in sentiment.

· Trump's attitude softens: After experiencing severe fluctuations over the weekend, market sentiment has improved. Previously, U.S. President Trump threatened to impose a new wave of large-scale tariffs, but then softened his stance, stating that “the U.S. wants to help China, not hurt it.”

· Tariff agreement probability surges: Predictive traders on Polymarket now believe that the probability of reaching a tariff agreement before November 10 has risen to 77%, while the likelihood of the 100% tariff threatened by Trump has dropped to 16%.

· The impact of geopolitics on the market: The ongoing US-China trade tensions have created a bearish sentiment in the market. President Trump will meet with Chinese President on October 31 at the APEC summit, which may prevent the escalation of trade tensions.

Market Reset and the Divergence of Ethereum After the Liquidation Wave

The large-scale liquidation wave that occurred a few days ago provided macro traders with a “cleaner” starting point, but the market outlook for Ethereum has shown a clear divergence.

· Market reset of the clearing wave: The previous brutal market sell-off led to nearly 20 billion dollars in leveraged positions being liquidated. This massive cleansing has created a cleaner “new beginning” for macro trading ahead of the key CPI event.

· Ethereum's Divergence: The Ethereum Foundation recently transferred $650 million, triggering a wave of profit-taking and liquidations, leading to mixed opinions among analysts. Some believe it could break through $5,000, while others warn that if the key support level of $3,470 fails to hold, it could slide to $2,850.

· The Rotation between Bitcoin and Gold: Kendrick observed that the sharp sell-off in gold coincided with a strong intraday rebound in Bitcoin, speculating that this could be a flow of funds rotating from “selling gold to buying Bitcoin.” However, he also acknowledged that during market panic, Bitcoin typically behaves more like a tech stock rather than a safe-haven asset, which undermines its claim as “digital gold.”

Conclusion

The crypto market is currently at a critical crossroads, where the CPI report on Friday and the direction of Sino-U.S. trade relations will determine the short-term volatility direction. Despite macroeconomic uncertainties raising doubts about Bitcoin's safe-haven attributes, and the risk of falling below 100,000 still existing, large-scale liquidations have reset the market structure. Investors should pay close attention to CPI data and cautiously assess the impact of geopolitical and macroeconomic changes on risk assets, preparing for a potential market rebound or further fluctuations.

Disclaimer: This article is for news information only and does not constitute any investment advice. The cryptocurrency market is highly volatile, and investors should make decisions with caution.