QCP Capital: U.S. CPI Data Meets Expectations, Options Market Signals Downward Pressure on Crypto Markets Due to Additional Selling Pressure

QCP Capital posted on its official channel that the US CPI data was in line with expectations. Markets are now forecasting a 25 bps rate cut probability of 62.5%, compared to 47.5% before the CPI announcement. The milder CPI data led to a brief sharp reaction in the stock and cryptocurrency markets.
The cryptocurrency rally was short-lived as the market fell after the US transferred 10,000 BTC to Coinbase Prime and Jump sold 17,000 ETH. front-end volatility for BTC and ETH fell sharply after the CPI announcement, dropping by around 10 volatility points. Risk reversals also fell further, with ETH and BTC dropping to -8 and -6 volatility points respectively. This suggests that the options market now expects more downward pressure on prices due to new supply.