BTC price rebounds to a key position, ETF capital inflow provides support

This week, Bitcoin opened at $82562.50 and closed at $86092.94, with a weekly increase of 4.28% and a volatility of 7.71%. This marks the second consecutive week of increase, but the trading volume has declined for three consecutive weeks. Currently, the BTC price is operating in a descending channel and is approaching the upper edge of the channel.

The Federal Reserve held a monetary policy meeting this week and released a dovish signal. The meeting indicated that intervention measures would be taken if economic issues arise and suggested that there may be two rate cuts this year.

With the stabilization of U.S. stocks and the massive inflow of ETF funds, Bitcoin has stabilized and rebounded to the upper edge of the descending channel. As the U.S. is set to announce PCE data next week, Bitcoin's price is at a critical moment for directional choice.

Macroeconomic Situation

On March 19, the Federal Reserve maintained the benchmark interest rate at its meeting, keeping the key lending rate in the range of 4.25-4.5%. In addition, the Federal Reserve also hinted at a further rate cut of 50 basis points in 2025 and announced adjustments to the pace of its bond reduction.

The Chairman of the Federal Reserve stated that they have lowered their economic growth expectations and emphasized that certain tariff policies are the main factors driving inflation upward. The U.S. stock market, which has fallen for three consecutive weeks, is now focused on the most anticipated commitment—if the economic situation worsens, the Federal Reserve will take action.

A clear "market rescue" signal is the slowdown of the balance sheet reduction starting from April 1, adjusting the U.S. Treasury reduction limit from $25 billion per month to $5 billion. The slowdown in tapering is seen as a boost to the bond market. The Federal Reserve's relatively "dovish" response to the market downturn indicates that it will pay close attention to employment and equity market stability during the process of achieving its inflation target, to prevent a larger crisis.

In the midst of the tug-of-war between interest rate cuts and chaotic tariff policies, although the Federal Reserve still maintains its stance, its attitude has begun to soften. Both the guidance for two rate cuts and the reduction of the limit on U.S. Treasury bond holdings are interpreted as a form of support for the decline in stocks and bonds.

Therefore, despite the lack of any fundamental changes in the "chaotic tariff policy" and "economic stagflation" issues, the market that has experienced a decline is beginning to rebound. The dollar index rose by 0.25% for the week. The Nasdaq, S&P 500, and Dow Jones rose by 0.17%, 0.51%, and 1.2% respectively. The 2-year and 10-year U.S. Treasury yields fell by 1.59% and 1.39% to 3.9670% and 4.2580% respectively.

Another portion of funds continues to choose safe-haven gold. London gold has achieved a three-week consecutive rise, up 1.23% this week, closing at 3023.31 USD/oz.

Cryptocurrency Market Capital Flow

In terms of funds, the BTC spot ETF has shown a breakthrough signal, experiencing positive inflows this week after a continuous decline for 5 weeks, with all 5 trading days of the week recording net inflows, totaling $1.05 billion. This large-scale inflow serves as a strong support for the rebound of BTC prices.

In terms of stablecoins, there was an inflow of $958 million throughout the week. This brings the total inflow across all channels to $1.95 billion, providing material support to a market filled with panic.

The BTC spot ETF channel funds have once again shown the role of a stabilizing force. The subsequent market trends need to be closely monitored. Of course, the BTC spot ETF funds are fundamentally constrained by the movements of the US stock market, which makes predicting BTC prices extremely difficult.

Market Selling Pressure Situation

With the price rebound, market selling pressure has also significantly weakened, dropping to 114,992 coins. Data shows that this week long-term holders reduced their holdings by 3,284 coins, while short-term holders reduced their holdings by 111,709 coins.

Long-term holders increased their positions by 73,000 coins over the week, while the exchange inventory decreased by nearly 7,000 coins. The selling pressure from short-term groups is being continuously absorbed, indicating that long-term holders recognize the current price.

Market Cycle Indicators

According to a certain indicator, the BTC cycle indicator is 0.375, and the market is in a rising continuation phase.