Sentiment in the crypto market reflects uncertainty as investors await the release of the U.S. Consumer Price Index (CPI), Federal Reserve hearings, and the start of earnings season. This is noted in the weekly report from QCP.

Analysts pointed out the lack of a clear momentum despite a busy calendar of macroeconomic and corporate events.

The first key test is set for July 14, when CPI data will be released. According to the firm, this report could adjust expectations for the Fed's next move. A softer inflation reading would bolster arguments for easing monetary policy, while negative data could reignite concerns.

Immediately after the CPI release, market attention will shift to Fed Chair Kevin Warsh, who will begin two days of hearings in Congress. Lawmakers are expected to ask questions about the agency's independence, its role in the economy, and its approach to returning inflation to the 2% target.

QCP believes that the combination of inflation statistics and Warsh's testimony will set the tone for the week as investors seek clearer signals regarding future policy direction.

Additionally, the second-quarter earnings season is set to kick off in the coming days:

  • On July 14, major U.S. banks will report, including JPMorgan, Bank of America, Goldman Sachs, Wells Fargo, and Citigroup;
  • On July 15, Morgan Stanley and BlackRock;
  • On July 16, Taiwan Semiconductor Manufacturing Company.

Consensus expectations for corporate results remain high. The earnings forecast suggests the strongest annual growth since 2021. However, given the stretched valuations in the stock market, particularly in AI infrastructure and energy sectors, this may not be sufficient.

Analysts believe that simply exceeding forecasts may not be enough for the market. A strong management outlook will also be crucial to justify current multiples and sustain the rally.

QCP emphasized that investors have begun to question whether the surge in demand for AI memory chips has already been fully priced in. The firm notes that this serves as a reminder of how high the expectations remain: even a strong fundamental backdrop no longer guarantees a positive market reaction if a significant portion of the optimism is already reflected in prices.

“For cryptocurrencies, the overall situation remains positive, but there is currently no clear catalyst. Institutional adoption, steady demand for ETFs, and limited supply continue to provide support; however, Bitcoin largely remains within a set range as investors await greater clarity on inflation and Fed policy prospects,” the experts concluded.

A positive close to the current week could shift the balance of sentiment. If macro data and corporate earnings confirm a bullish scenario, improved risk appetite could extend to digital assets, QCP clarified.

At the time of writing, Bitcoin is trading around $62,900. Over the past week, the asset has seen little price change despite subdued volatility.

Hourly BTC/USDT chart from Binance. Source: TradingView.

Recall that in June, the Fed maintained the key interest rate at 3.5-3.75% per annum. The chair of the regulator indicated the possibility of raising it by the end of the year.