Crypto Assets Market Weekly: BTC Continues Rebound, Fed's Stance Influences Market Direction

This week, the price of Bitcoin (BTC) continued its upward trend, opening at $83,733.07 and finally closing at $85,177.34, with a weekly increase of 1.72% and a volatility of 4.06%. This marks the second consecutive week of a Rebound for BTC, but the market lacks upward momentum, and trading volume has noticeably shrunk. The BTC price continues to operate outside of the descending channel and is currently testing the 200-day moving average, a key technical indicator.

In terms of the macro environment, the U.S. government's trade policy has entered the negotiation phase, but preliminary talks with Japan have not yielded the expected results, putting the U.S. government in a difficult position. Major trading partners are taking a tough stance, and secondary target countries are also leaning towards a hardline position, with countries seemingly adopting a strategy of buying time. In fact, the U.S. is confronting the world over tariff issues, while also bearing unprecedented pressure itself.

Fed Chairman Powell spoke this Wednesday, stating that the Fed is capable of waiting for clearer signals before considering adjustments to its policy stance. This statement reflects the Fed's cautious attitude in the face of changing trade conditions, leading to pressure on the stock market, bond market, and foreign exchange market.

On the policy front, the US government continues to call for interest rate cuts, but before achieving substantial breakthroughs, we believe that politics, the economy, and the market will continue to operate along rational paths in the medium to long term.

Consumer confidence remains low, and businesses are confused about production plans. In the absence of support from the government and central banks, Wall Street continues to sell off long positions and reduce trading. Major stock indices fell throughout the week, with the Nasdaq, S&P 500, and Dow Jones Industrial Average declining by 2.62%, 1.5%, and 1.33% respectively, and trading volume has significantly decreased.

The bond market also performed poorly. The yield on 2-year government bonds fell to 3.7580%, and the 10-year yield dropped to 4.4960%, still at a high level. The risk of long-term government bonds is significant, with a massive sell-off following an 11.25% surge last week, leading to tightening liquidity.

The US dollar index has fallen for the fourth consecutive week, dipping to 99.171% this week. Funds are flowing from the US to Europe, which is the result of the dollar index decline, the stock market drop, and the bond market's failure to absorb the outflow of funds. Capital outflow is the situation that the US is least willing to see.

Fed officials have largely agreed: the economy has not yet deteriorated, tariffs will bring uncertainty to inflation decline and economic development, and the Fed will remain cautious until the situation becomes clearer. This has dispelled market expectations for an emergency rate cut by the Fed. Currently, the market expects the Fed to potentially cut rates for the first time in June, with a high probability of four rate cuts throughout the year.

In terms of on-chain data, the selling pressure continued to weaken this week. The total on-chain sell-off volume dropped to 107810.75 BTC, with short-term holders accounting for 103713.35 BTC and long-term holders for 4097.4 BTC. Exchanges continued to show a net outflow, with an outflow of 19467.31 BTC this week. The long-term holder group is still playing a stabilizing role, with a net increase of nearly 100,000 BTC this week. As prices rebounded, the overall unrealized loss level for short-term holders dropped to around 8%.

In terms of capital flow, stablecoin channels achieved the highest weekly inflow scale since January, exceeding $950 million. The net inflow of funds through ETF channels exceeded $10 million, and BTC has recently performed continuously better than the Nasdaq index.

According to data from a certain analysis engine, the BTC cycle measurement indicator is 0.125, indicating that the market is in a rising relay phase.