QCP Capital analysts are forecasting that additional stimulus measures from China will create a more bullish environment for risk assets, including cryptocurrencies.

"We believe more easing is coming from the People's Bank of China (PBoC), and they have communicated as much, and combined with the U.S. Federal Reserve joining the global cutting cycle, all major central banks, except Bank of Japan, are now ready to inject more liquidity into the market. The macro space continues to look more and more bullish for risk assets, including crypto," QCP Capital analysts said.

The analysts believe that due to various positive factors driving the market, a potential upcoming surge in cryptocurrency prices could catch many investors off guard. "We know how explosive crypto prices can be, and with so many bullish catalysts, we think the next move higher will leave many people surprised and sidelined," they added.

On Tuesday, China’s central bank rolled out a comprehensive set of policies designed to rejuvenate the struggling housing and equity markets. These measures appear to be effective, with the SSE Composite Index rising by 1.16%, an increase of 33.18 points to close at 2,896.31.

European equities rallied for a second day, with sectors linked to the Chinese economy seeing notable gains as China's stimulus fuelled widespread risk-on sentiment. In London, the FTSE 100 closed up 0.35%, while the STOXX Europe 600 rose 0.11%. On Tuesday, the S&P 500 closed up 0.25%, the Dow Jones increased by 0.20%, and the Nasdaq rose by 0.56%.

Despite this positive performance in the U.S. stock markets, the global cryptocurrency market cap fell to $2.34 trillion, reflecting a 0.9% decline over the past 24 hours.

BRN analyst Valentin Fournier noted that the influx of liquidity from China's stimulus measures is likely to drive gains in lower market cap digital assets as the bull run progresses, emphasizing that "identifying the right projects to invest in now will be crucial for capitalizing on the upcoming altcoin season."

"Currently, bitcoin is stabilizing below $64,000, and there are numerous short positions in the market that could be squeezed, contributing to upward momentum," he continued. "While some indicators suggest a sustained rally as we approach the end of the year, investors should remain cautious, as overbought conditions could trigger a potential dip."

The QCP Capital analysts also pointed out that the difference in yields between the 2-year and 10-year U.S. Treasury notes signals the potential for increased sentiment towards risk assets. "We have seen the yield spread between the 2-year and 10-year U.S. Treasury notes continue to widen over the past month, moving 40bps higher and now trading at 21bps. A widening spread generally suggests optimism about economic growth, which is supportive of risk assets in the medium to long term," they said.

Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to deliver objective, impactful, and timely information about the crypto industry. Here are our current financial disclosures.

© 2024 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。