Crypto Bulls Just Got Their Macro Wake-Up Call: Heres Why
An unprecedented surge in the Philadelphia Federal Reserves May Manufacturing Business Outlook Survey has jolted global risk markets and given crypto asset traders their clearest macro catalyst of the year. The Future New Orders diffusion index leapt by forty-plus points, a move that Julien Bittel, head of macro research at Global Macro Investor (GMI), called literally historic.
Crypto Bulls Can Rejoice
Bittels commentary on X framed the print with statistical precision: Philly Fed data for May dropped yesterdayand the Future New Orders index just made history. Literally. Expectations for new orders posted the largest monthly spike ever recordedgoing all the way back to the indexs inception in May1968. A staggering +4.3 standard deviation move. He underlined the shock with a comparison few macro watchers will forget: For perspective: thats an even bigger move upthan the downside collapse during the depths of the 2008 Global Financial Crisis (-4.1). Let that sink in
Bittel then set the surge in a broader narrative that has animated his research since late last year. Q1 growth was weak. The reason is straightforwardfinancial conditions tightened sharply in Q4. The dollar ripped, bond yields surged a classic tightening phase, he wrote.
The proximate trigger, in his telling, was businesses panicloading inventories ahead of Trump tariffs, and markets frontrunning the inflation narrative. Those dynamics, he argued, are a replay of Donald Trumps first term: Weve highlighted repeatedly: this had all the hallmarks of Q42016 during Trumps first term. Just like early2017, that tightening spilled over into slower growth momentum in Q1.
Where 2017 began with doubt and ended in a synchronous global boom, Bittel believes 2025 is rhyming. Those Q1 headwinds have flipped into Q2 tailwinds, he insisted. Everything flows downstream from changes in financial conditions Purchasing managers expectations are shiftingand shifts in thinking eventually translate into action. Sentiment shifts first. Action follows. It always does. Bullish.
The crypto market responded muted. Bitcoin reclaimed the $104,000 level in earlyEuropean trade, but lost it later on. Ether steadied near $2,600, and highbeta layerone tokens such as Solana and Avalanche moved in tandem.
GiancarloCudrig, head of markets at Immutable, said the scale of the shock is less important than how underpositioned investors are for an upside growth surprise. An upside economic shock like this+4.3 on new ordersis rare. But the bigger story is market positioning. Asset prices are not prepared. The meltup is the asymmetric risk. Now its being repriced.
Independent analyst MarketHeretic struck a similar note on X: When this dropped, markets didnt even blink. Because the shifts already in motion. This wasnt news, it was confirmation. Thats the real tell, when markets shrug off a foursigma upside shock. It means the turn is already upon usand its just getting started.
For crypto investors, the implications are immediate. A softer dollar and retreating realyield expectations reduce the opportunity cost of holding nonyielding assets, while the early phase of a reflationary turn historically favours highbeta exposures. Bittels own playbook is unambiguous: Sentiment shifts first. Action follows. As long as that chain reaction continues, the crypto bulls appear to have both math and momentum on their side.
At press time, the total crypto market cap stood at $3.28 trillion.
Read more: https://www.newsbtc.com/news/crypto-bulls-just-got-their-macro-wake-up-call-heres-why/
Text source: NewsBTC
