he Sahm Rule that is one of the most reliable recession indicators is still signaling an upcoming recession in the United States. This has continued to be above the threshold, which has indicated a continued presence of recessionary sentiments.
Crypto Has Negative On-Chain Indicators
Currently, the crypto markets are facing bearish on-chain indicators: net selling volumes and the rising number of large Bitcoin transactions going to exchanges. This bearish data is however in line with the trend of the entire crypto market.
Possible for Bullish Reversal
However, with all those bearish indicators signaling potential risk in markets, some analysts identify that the worst has already been done and there is the possibility of a market shift in sentiment. Furthermore they identify the recent capitulation of both macro and crypto back in early august as the bottom for risk assets and the beginning of the next leg up.
Favorable Monetary Policy Expectations
One of the main reasons why some analysts see better days for the crypto market in the upcoming month is related to the change in monetary policies that will take place in September. Many expect interest rate to be cut and monetary easing to start which could be good for the economy.
Crypto's Crossroads: Bull vs. Bear
Staying at the Crossroads Though there is a possibility of a crypto recession and bearish on-chain trends the oversold conditions coupled with the possibility of monetary policy changes could form the basis of a crypto bull run. While the market is immersed in these contradictory signals, investors are to pay attention to the changes in the environment.
