The CPI data on August 12th may be the biggest variable affecting the market direction recently, and it is also the only key data this month.

This data is not just about inflation itself; more importantly, it is whether it will become a "passport" for the Federal Reserve to ease policy. Once price pressures ease, there will be more reasons to promote interest rate cuts, a weaker dollar, and increased liquidity in funds, which would be a comprehensive positive for the crypto market.
In simple terms, there are two possibilities.
The first situation is if the data is significantly below market expectations.
This means that inflation is cooling down, and funds are starting to bet on loose assets. The fastest reactions generally come from high-risk, highly elastic targets, such as some small-cap blockchain games, DeFi, stablecoins, and RWA themes, as well as the ETH-related ecosystem, which may lead the charge.
The second option, if the data is similar or slightly higher.
The market may first take a step back, drop a bit to react, and then see if there are signs of stabilization; the sentiment is under pressure in the short term.
The data just came out and the fluctuations are severe in the first few minutes; often it's quantitative strategies and bots sweeping orders, and the direction may not be accurate, so don't rush to follow the trend.
The true market sentiment often becomes clearer only after half an hour to more than an hour, once the trends of U.S. Treasury yields and the U.S. dollar index stabilize.
If the data appears positive on the surface, but both the US dollar and US Treasuries are rising, it usually means that the market is pricing in other potential negative expectations. At this time, it is advisable to reduce positions and temporarily avoid risks.