Gate Research Institute: Wosh is expected to accommodate interest rate cuts in the short term | The market may experience a technical rebound

Cryptocurrency Market Overview

• BTC (+1.74% | Current Price 77,765 USDT): After a fierce sell-off, Bitcoin is currently trading between $77,000 and $78,000. Over the past two weeks, Bitcoin’s price has fallen approximately 20%, during which over $1.6 billion in leveraged crypto positions were forcibly liquidated. After de-leveraging, macro policies are the primary driver of Bitcoin’s current revaluation. If the market shifts towards more cautious rate cut expectations, the policy environment will be unfavorable for assets relying on low-cost leverage and abundant liquidity. From a technical perspective, there is strong resistance above $90,000, while strong support is seen around $73,000. If this level is broken, the next target could be near $72,000, which is among the highs from March to June 2024.
• ETH (+1.48% | Current Price 2,293 USDT): On the daily chart, Ethereum’s bullish structure has collapsed. During this recent decline, Ethereum easily broke below $2,400. Once this level was breached, the liquidation engine kicked in, causing the price to plummet almost vertically into the $2,100-$2,200 demand zone, threatening the psychological level of $2,000. Currently, the market structure is bearish, with every rebound encountering selling resistance, making it difficult for the price to regain $2,400. Overall, the market is trying to find new support levels and has not fully reset. The upward rally is merely a rebound within a downtrend, not the start of a new bullish phase.
• Altcoins: In the past 24 hours, altcoins have staged a partial rebound amid panic, with XRP up 1.95% and SOL up 3.48%. The Fear & Greed Index is at 17, indicating the market remains in “Extreme Fear.”
• Macro: On February 2, the S&P 500 rose 0.54% to 6,976.44 points; the Dow Jones Industrial Average increased 1.05% to 49,407.66 points; the Nasdaq gained 0.56% to 23,592.11 points. As of 11:30 AM (UTC+8) on February 3, spot gold is priced at $4,769 per ounce, up 2.35% in the past 24 hours.

Hot Tokens to Watch

ZIL Zilliqa (+59.32%, Market Cap $132 million)

According to Gate data, ZIL is currently trading at $0.006260, up 59.32% in 24 hours. Zilliqa is a high-throughput public blockchain platform that scales performance to thousands of transactions per second, aiming to solve the major bottleneck of transaction speed and scalability in current blockchains. It balances speed with security, finding an optimal point between the two.

This surge in ZIL is mainly driven by technical breakout. The price broke through recent highs, with a 7-day RSI of 64.41, indicating bullish momentum that has not yet reached overbought levels. Breaking key resistance often attracts algorithmic and trend-following traders. Maintaining above the psychological level of $0.005 likely intensified FOMO among investors.

C98 Coin98 (+37.03%, Market Cap $25 million)

According to Gate data, C98 is currently trading at $0.02524, up 37.03% in 24 hours. Coin98 is a cross-chain liquidity protocol with a full suite of products, including the Coin98 Wallet, Exchange, and Bridge. The Wallet is a non-custodial multi-chain crypto wallet and gateway built as the foundation for future cross-chain infrastructure. The protocol provides a one-stop platform for users to access the DeFi ecosystem.

On February 2, a tweet from a well-known crypto trader noted that C98’s maximum supply is $1 billion, and the current price is at an 87.5% discount to its 2025 high, describing its price as “compressed and poised for a move.” Tokens with relatively low circulating supply like C98 tend to be highly volatile when retail interest surges. The tweet triggered FOMO, with trading volume spiking 256% above the 30-day average.

PURR Purr (+29.37%, Market Cap $53 million)

According to Gate data, PURR is currently priced at $0.08841, up 28.37% in 24 hours. PURR is the first native token of Hyperliquid L1 blockchain under HIP-1. Its launch involved no sales and no planned use cases, mainly serving as a way for users to participate in the Hyperliquid ecosystem and benefit from its growth.

PURR broke through the 23.6% Fibonacci retracement level and remains above the 7-day simple moving average. The MACD histogram turned positive, and RSI-7 is at 68.31, indicating it has not yet entered overbought territory. With spot trading volume up 54.62% to $3.26 million, traders may interpret the Fibonacci retracement breakout as a buy signal. If it closes above $0.0995 (the high of the wave), the next target could be the 38.2% Fibonacci retracement level.

Alpha Insights

JPMorgan: Expect Waller to Short-Term Accommodate Trump’s Rate Cuts, Return to Hawkish Stance After Midterm Elections

On February 2, JPMorgan Chief Economist Michael Feroli predicted in a report that Waller might favor rate cuts in the short term, at least this year. However, he warned: “Over time, especially after the midterm elections, his stance is likely to shift, possibly back to a more hawkish stance.” Additionally, a former official who worked with Waller believes that the “real Waller” will eventually emerge. Notably, JPMorgan has not adjusted its rate cut expectations due to Waller’s nomination. Feroli stated that even if Waller takes office, the Fed is expected to remain on hold for the rest of this year.

The market’s divergence on Bitcoin’s price largely stems from differing views on future dollar liquidity. Waller’s potential “dove then hawk” path will only heighten this uncertainty, requiring short- and medium-term expectations to be segmented. In the short term, rate cut narratives will dominate market sentiment, supporting risk assets; but in the medium term, policy shifts must be watched, as this expectation gap itself is a source of volatility.

Retail Investor Pessimism Reaches Extreme, Market May Experience Technical Rebound

On February 2, crypto research firm Santiment posted on social media that since January 28, Bitcoin has fallen 16%, with negative sentiment and FUD (Fear, Uncertainty, Doubt) surging. Social data shows that retail investor pessimism has surpassed any level seen since the crash on November 21 last year. Usually, after such significant negative sentiment shocks, markets tend to rebound technically. So far, this rebound shows a similar pattern to previous FUD events.

High volatility in crypto amplifies emotional impacts, but rational investors should avoid making decisions based solely on sentiment indicators. An effective strategy combines on-chain data, macro trends, and technical analysis, maintaining contrarian thinking during extreme sentiment, and acting decisively when a trend reversal is confirmed. History doesn’t repeat but rhymes; Santiment’s data again confirms the classic pattern that markets are born in despair and rise amid hesitation.

Cboe Plans to Restart Binary Options Trading to Compete Directly with Prediction Markets

According to WSJ on Monday, Cboe Global Markets, one of the world’s leading derivatives exchanges, is evaluating relaunching binary options trading aimed at retail investors, directly competing with the rapidly expanding prediction market sector in recent years. The proposed binary options will operate as fixed-income derivatives: contracts will pay a preset amount or zero at expiry, similar to the “Yes/No” contracts widely used in current prediction markets. Notably, Cboe previously launched binary options linked to major financial indices in 2008, but they had limited response in a predominantly institutional market and were eventually discontinued. This time, Cboe states it will focus on compliance frameworks and product design.

This move reflects how prediction market products are conceptually inspiring traditional finance. Over the past two years, platforms like Polymarket and Kalshi have experienced explosive growth in macro events, elections, rate decisions, and index trends, demonstrating retail demand for “low-threshold, fixed odds, outcome-driven” trading tools. Compared to traditional options with complex Greeks and margin mechanisms, binary/prediction contracts are closer to a financialized way of expressing information and opinions. If Cboe can combine the intuitive experience of prediction products with the clearing, risk control, and liquidity advantages of a regulated exchange, it could reshape retail derivatives trading. This also indicates that prediction markets are no longer just fringe experiments in crypto or alternative finance but are pushing traditional finance to reconsider whether users need complex models or clear results.
References:

• Gate, https://www.gate.com/trade/BTC_USDT
• Farside Investors, https://farside.co.uk/btc/
• Gate, https://www.gate.com/trade/ETH_USDT
• TheBlock, https://www.theblock.co/post/388008/cboe-targets-prediction-market-all-or-nothing-options-revival-wsj?utm_source=twitter&utm_medium=social
• X, https://x.com/santimentfeed/status/2018338084291477745

[Gate 研究院](https://www.gate.com/learn/category/research) is a comprehensive blockchain and crypto research platform providing in-depth content, including technical analysis, hot insights, market reviews, industry research, trend forecasts, and macroeconomic policy analysis.

Disclaimer Investing in cryptocurrencies involves high risk. Users are advised to conduct independent research and fully understand the nature of assets and products before making any investment decisions. Gate is not responsible for any losses or damages resulting from such investment decisions.