Analyzing ETH and BTC in conjunction with US CPI expectations requires understanding the following core logical chains:

1. Core Impact Pathway

US CPI Data → Federal Reserve Monetary Policy Expectations → US Dollar Liquidity/Risk Appetite → Cryptocurrency Market (BTC/ETH)

CPI (Consumer Price Index) is the most critical basis for the Fed's adjustment of monetary policy (especially interest rates). Higher-than-expected CPI will reinforce expectations of rate hikes or delaying rate cuts, while lower-than-expected CPI may strengthen expectations of rate cuts or halting hikes.

2. Three Possible CPI Scenarios and Their Impacts

Scenario 1: CPI exceeds expectations (Persistent Inflation)

· Market Reaction: Risk aversion surges. Traders bet on a more "hawkish" Fed (rate hikes, maintaining high rates longer), leading to:
· US Dollar Index (DXY) strengthening.
· US Treasury yields (especially short-term) rising.
· Stocks, gold, cryptocurrencies, and other risk/inflation-hedging assets under pressure.
· Impact on BTC/ETH:
· Short-term (hours/days after data release): Likely to decline sharply. Increased correlation with Nasdaq tech stocks, with potential sell-offs. Leveraged long positions may be liquidated, intensifying the decline.
· Medium-term: Continued high inflation data will reduce market expectations for rate cuts in 2024, suppressing the overall crypto bull market sentiment, and capital inflow may slow.
· ETH/BTC Watchpoint: During broad sell-offs, ETH's higher volatility compared to BTC may lead to larger declines. Activity in DeFi, NFTs, and other ecosystems may also weaken due to reduced risk appetite.

Scenario 2: CPI meets expectations (Steady Inflation Decline)

· Market Reaction: The market has largely priced in this scenario. Reactions will be relatively mild, with volatility possibly arising from surprises in specific components (e.g., core CPI, super-core inflation).
· Impact on BTC/ETH:
· Short-term: Possible "buy the rumor, sell the fact" pattern. If prices rose earlier on expectations of lower CPI, data release may trigger slight profit-taking. Overall, sideways movement.
· Medium-term: Data in line with expectations won't alter the Fed's policy path; focus will shift back to internal crypto factors (ETF fund flows, on-chain activity, technological upgrades).
· ETH/BTC Watchpoint: Market may diverge, driven more by ecosystem news (e.g., ETH ETF progress, Layer2 data; BTC miner activity, ETF net inflows).

Scenario 3: CPI below expectations (Rapid Cooling of Inflation)

· Market Reaction: Risk assets rally strongly. The market will bet on earlier and faster rate cuts by the Fed.
· US Dollar Index weakens.
· US Treasury yields decline.
· Global liquidity expectations improve, capital floods into risk assets.
· Impact on BTC/ETH:
· Short-term: Very bullish. Crypto markets will follow stocks (especially tech) higher, possibly with short squeezes and FOMO-driven buying.
· Medium-term: Reinforces narrative of cryptocurrencies as "beneficiaries of loose liquidity," attracting traditional capital and supporting upward trends with macro fundamentals.
· ETH/BTC Watchpoint: During broad rallies, major altcoins like ETH may outperform BTC, as high risk appetite drives capital toward higher-beta (more volatile) assets. Tokens within the ETH ecosystem may show more active performance.

3. Subtle Differences Between BTC and ETH

· BTC: More pure "macro asset" and "digital gold"
· Highly sensitive to CPI/rate changes. Its price includes significant macro liquidity premiums.
· Post-approval of US spot ETF, it has closer ties to traditional finance, making it more susceptible to macro capital flows.
· During CPI-driven volatility, BTC is often viewed as the "benchmark asset" and "safe haven" within crypto (relative to other altcoins).
· ETH: Driven by macro + ecosystem fundamentals
· Also affected by macro factors but compounded by its own ecosystem's health.
· Positive factors: Lower CPI leading to broad market rallies can boost ETH due to its extensive DeFi, gaming, Layer2 ecosystems.
· Risks: Higher CPI causing market crashes may pressure leveraged applications within ETH ecosystem (e.g., lending protocols), triggering chain reactions.
· Long-term narrative: Its "deflationary asset" (via EIP-1559 burn mechanism) and "digital economy infrastructure" narrative become more attractive in low-inflation, high-growth environments.

4. Special Considerations in the Current Market Environment (as of 2024)

1. Rate Cut Expectations: Markets have shifted from "rate hikes to fight inflation" to "when to cut rates." Therefore, CPI data's impact on rate cut timing is more critical than before.
2. Strong Internal Crypto Drivers:
· BTC: Continuous inflows/outflows of spot ETF funds are key recent price drivers, sometimes offsetting macro adverse effects temporarily.
· ETH: Progress in ETF application approvals is a more significant catalyst than individual CPI data.
3. Geopolitics and Safe-Haven Dynamics: During high inflation and volatility, BTC's "digital gold" safe-haven attribute may be repriced, but this is balanced against the negative impact of tightening dollar liquidity.

Summary and Trading Strategy

1. Before Trading:
· Monitor market consensus expectations: compare actual vs. expected values, focusing on core CPI.
· Assess positions: Volatility usually spikes around CPI release; check leverage to avoid liquidation.
· Prepare scenario-based response plans: plan different strategies based on the three scenarios above.
2. During Trading:
· Observe real-time reactions: watch DXY, Nasdaq futures (especially Nasdaq) immediately after data release; crypto markets often lag by a few minutes but follow the same direction.
· Beware of "false moves": initial sharp swings may reverse; wait for market digestion (usually 15-30 minutes) before judging direction.
3. Long-term Perspective:
· For long-term holders (HODLers), a single CPI report should not alter core investment logic. Persistent high inflation damages all risk assets' appeal, while controlled inflation favors emerging assets like crypto.
· ETH's long-term value depends more on network adoption and utility; macro cycles mainly influence its price volatility range.

Final conclusion: US CPI expectations are one of the most critical external macro variables influencing BTC and ETH prices in the short term, mainly through changes in global dollar liquidity and risk appetite. Currently, it primarily trades on the "Fed rate cut path." BTC reacts more directly and sensitively, while ETH must consider both macro impacts and its own ecosystem development. Traders should implement risk management, and investors should look beyond short-term volatility to long-term trends.