BTC Market Weekly Report: Maintaining Rebound Momentum, Fed Attitude Influences Market Expectations

This week, Bitcoin opened at 83733.07 USD and closed at 85177.34 USD, rising 1.72% over the week, with a volatility of 4.06%. This marks the second consecutive week of a rebound for Bitcoin, but the market lacks upward momentum, and trading volume has significantly shrunk. Currently, Bitcoin's price has been operating outside the descending channel for two weeks and is testing the important technical indicator of the 200-day moving average.

The United States' foreign trade policy has entered the second phase of negotiations, but the preliminary results with Japan have not met expectations. This has put the U.S. government in a difficult situation: major target countries are responding forcefully, while secondary target countries are hardening their stance. In fact, as the U.S. confronts the world on tariff issues, the pressure it faces is also unprecedented.

This Wednesday, Fed Chairman Powell stated, "Currently, we have the ability to wait for clearer information before considering adjustments to our policy stance." The Fed's approach of maintaining the status quo has brought triple pressure back to Washington for the stock market, bond market, and foreign exchange market.

Before the Fed takes substantial action, we tend to believe that politics, the economy, and the market will operate along a rational path in the medium to long term.

Policy, Macroeconomic Finance and Economic Data

In terms of foreign trade negotiations, the preliminary talks between the United States and Japan have not made substantial progress. The Japanese Prime Minister's speech before the talks was tough. After China's strong countermeasures, more countries, although still negotiating with the United States, have also realized that the United States' situation is not as advantageous as it claims.

Consumer confidence remains low, and businesses are confused about production plans. Wall Street has not received assistance from the government or the Fed, continuing to sell off long positions and reduce trading.

In the four trading days of this week, the Nasdaq, S&P 500, and Dow Jones indices continued to decline, recording weekly declines of 2.62%, 1.5%, and 1.33%, respectively, with trading volume significantly decreasing.

The bond market also performed poorly. The yield on the 2-year Treasury bond continued to decline to 3.7580%, while the 10-year yield fell to 4.4960%, remaining at a high level. The risks of long-term Treasury bonds are evident, as last week's surge of 11.25% indicated a liquidity crisis amid significant sell-offs.

The US dollar index has fallen for four consecutive weeks, reaching a low of 99.171% this week. Funds are flowing from the US to Europe. The decline in the dollar index reflects the drop in the stock market while the bond market has failed to absorb the outflow of funds. Capital outflow is the situation that the US is most reluctant to see.

Fed officials expressed a generally consistent view: the economy has not yet deteriorated, tariffs have increased inflation and uncertainty in economic development, and the Fed will remain inactive until the situation becomes clearer.

The Fed's "hawkish" stance has dispelled market fantasies about an emergency rate cut to stimulate the economy. As of the weekend, the CME FedWatch shows that the probability of a rate cut in May has fallen to 14.4%. Currently, the market expects the Fed may first cut rates in June, with a probability of 70.2%, and could cut rates 4 times throughout the year.

On-chain Data Analysis

This week, the on-chain selling pressure of Bitcoin continues to weaken, significantly decreasing compared to last week. The total on-chain selling scale dropped to 107810.75 BTC for the week, with short-term holders accounting for 103713.35 BTC and long-term holders 4097.4 BTC. There has been a continuous net outflow of 19467.31 BTC from exchanges.

Long-term holders continue to play a stabilizing role, with a net increase of nearly 100,000 coins this week. As prices rebound, the overall unrealized loss level for short-term holders has dropped to about 8%.

Capital Flow

Stablecoin channels achieved the highest weekly inflow scale since January, exceeding $950 million. The net inflow of funds through ETF channels surpassed $10 million, and Bitcoin's recent performance continues to be stronger than the Nasdaq index.

Cycle Indicator

According to data from a certain analytics engine, the Bitcoin cycle indicator is 0.125, indicating that the market is in a rising continuation phase.