Whale increased its long exposure to Bitcoin and Solana on Thursday, July 2nd. The whale put more than $70 million at stake.
Additionally, the trader opened a 10X short position on Hyperliquid (HYPE), bringing the total bet to over $78 million.
At first, the bet appears to be going well, with an unrealized profit of about $9.2 million.
Positive unrealized P&L (P&L) followed a comfortable rally after Weakest US jobs report Data. In most cases, weaker jobs report data suggests the Fed will reconsider its previous inclination toward raising interest rates to boost the labor market.
Subsequently, any expectations of interest rate cuts by the Fed tend to boost risk sentiment, leading to a relief rally across the cryptocurrency and stock markets. In fact, the stock market recorded mixed results.
As of writing, Google Finance showed that S&P and Nasdaq futures were green, suggesting the recovery could pick up.
Will the Fed destroy Bitcoin and Solana’s recovery?
However, the Fed’s interest rate expectations did not change much after the weak jobs report. According to the FedWatch tool, the odds of another rate hike fell from 28% to 17%, nearly doubling.
In fact, this eased fears of a rate hike, which would likely fuel a mid-week recovery as Bitcoin rose to $62,000. But alleviating concerns does not mean an automatic reduction in interest rates.
Rate traders were 83% expecting the Fed to keep interest rates unchanged at the current 3.50%-3.75% level before the end-July meeting. After the July 4 weekend, minutes from the FOMC meeting will be released next Wednesday, July 8.
A low liquidity weekend and upcoming FOMC meeting minutes could still lead to market volatility.
In fact, as of writing, the price of Whale has already fallen by $1.2 million, largely impacted by the HYPE short position, which is down 70%. A temporary pause in the Fed’s interest rate will likely expose the whale to further losses.
Meanwhile, smart money investors were redoubling their efforts Solana (Sunday) At the current level of $81. This group increased bids by 129% in the last 24 hours.
What’s next for Bitcoin, Solana?
However, for Bitcoin, short positions were accumulating as the royal coin attempted to reclaim $62,000. There was over $2 billion in short positions, resulting in 57% control at the time of writing.
This means Bitcoin (BTC) Traders were increasingly bearish after the relief bounce towards $62K. It also creates the best conditions for a short squeeze. But this depends on how the market reacts to the FOMC minutes.
However, the overall hurdles of $62.3K and $65K must be cleared in order to achieve a sustainable recovery.
Final summary
- Whale increased its long exposure to Bitcoin and Solana to more than $70 million following the weak US jobs report
- While concerns about a Fed rate hike have subsided, a temporary pause in interest rates could lead to renewed selling in the market
