The information, opinions and judgments on markets, projects, currencies, etc. mentioned in this report are for reference only and do not constitute any investment advice.
This week, BTC opened at $80,708.21 and closed at $82,562.57, up 2.31% for the week, with an amplitude of 10.86%. The trading volume continued to decline compared with last week. The BTC price fell in a downward channel and rebounded slightly.
The United States released CPI data that was slightly higher than expected, and the Russia-Ukraine war also made further progress towards an end, giving U.S. stocks and BTC a chance to catch their breath.
However, the US valuation is still in the process of falling and bottoming out, and there is still room for downward movement based on historical data. This is because the adjustment reason that drives the valuation down - the worry that tariff chaos may trigger inflation and push the US economy into a state of stagflation has not been eliminated, the chaos maker Trump is not ready to stop, and the Fed Chairman is still reducing holdings based on data.
This chaos and deadlock makes it difficult to dispel the worries of stagflation. The longer it drags on, the greater the room for valuation to fall. This is why we are bearish on BTCs rebound in the short term.
Macro-financial and economic data
Last week, the United States released employment data, with non-farm payrolls slightly lower than expected and the unemployment rate rising slightly, showing signs of slowing employment and exacerbating expectations of a US economic recession. The market fell sharply in panic.
This week, the United States released the latest CPI data. The unadjusted CPI for February rose 2.8% year-on-year, slightly lower than the expected 2.9% and the previous value rose 3%. The seasonally adjusted CPI for February rose 0.2% month-on-month, expected to rise 0.3% and the previous value rose 0.5%. The CPI data was lower than expected, which offset the panic of last weeks employment data and gave the frightened market a temporary respite.
After last weeks sharp sell-off and this weeks positive CPI data, the US stock market temporarily turned around from a deep decline and recovered some losses, but it was still in a downward trend for the whole week. The Nasdaq was still below the 250-day line, and the weekly decline narrowed to 2.43%; the SP 500 recovered to above the 250-day line; the Dow Jones fell 3.07%, slightly recovering to the 250-day line.
On the 14th, the University of Michigan released the preliminary data of the Consumer Confidence Index for March, showing that the Consumer Confidence Index fell to 57.9, far below the market expectation of 63.1 and significantly lower than the previous value of 64.7. At the same time, the initial value of the one-year inflation rate expectation rose to 4.9%, exceeding the expected 4.2% and also significantly higher than the previous value of 4.3%. It shows that American consumers are increasingly worried about the economic outlook.
The University of Michigans consumer confidence index has reflected in advance the impact of Trumps chaotic and reckless tariff policy on the confidence of end consumers. What is painful for the market and American business owners is that the US president is still happy to show his power in this way, and it may take worse market feedback and longer uncertainty for there to be a change.
On Friday, U.S. stocks, European stocks and even Russian stocks all rebounded significantly, mainly due to the markets Russia-Ukraine War making some progress - the two sides plan to reach a 30-day ceasefire agreement.
Trumps conspiracy theory of using government employee layoffs and tariff wars to achieve an economic recession in order to force the Federal Reserve is gaining more and more market share, at least thats what it seems to be.
These are all speculations about the motivations that are difficult to confirm. A more objective judgment may be that the essence of this round of US stock market adjustments is the valuation adjustment caused by the relay of interest rate cuts. The SP 500 Shiller CAPE Ratio peaked at 37.80 times in December, approaching the recent high of 38.71 times in November 2021 after the pandemic. This high valuation includes the expectations of the Trump deal and the rapid development of the AI industry. Since 2025, DeepSeek has punctured the growth myth of AI. Trumps tariff policy and layoffs have shattered economic growth expectations, making it difficult for the market to bear such a high valuation, and instead turned around and corrected downward to seek a new balance.
At present, the maximum declines of Nasdaq, SP 500 and Dow Jones reached 14.59%, 10.36% and 9.79% respectively, all of which are near the 250-day line and have entered the market correction range (10%-20% decline), but it does not mean that the market has been cleared. At present, the SP 500 Shiller CAPE Ratio is 34.75 times, which is about 8.07% lower than the high point. According to the historical rules of the past 20 years, if it continues to fall, it will return to 32.89 times, and will fall by more than 5%. If it returns to the average of 27.25 times, there is still more than 21% of retracement space. Of course, we judge that the probability of such a deep adjustment is extremely low, and it is only possible if the US President and Powell lose their minds and allow the US economy to truly go into recession.
Amid the chaos, risk aversion increased, pushing gold prices above the $3,000/ounce mark. The U.S. dollar index rebounded slightly after hitting a record low, with the 2-year U.S. Treasury yield rising by 0.7% and the 10-year U.S. Treasury yield rising by 0.37%, indicating that some funds have begun to withdraw from U.S. Treasury bonds and start to buy the bottom of the stock market.
In short, the U.S. stock market has entered a correction period, but the outlook for inflation and interest rate cuts remains unclear, especially as the impact of Trumps tariffs and layoffs has not yet passed, making it more likely that the market will continue to correct downward to calm asset valuations in a chaotic market. Influenced by the BTC Spot ETF, we maintain our judgment that BTC will continue to be constrained by the adjustment of the U.S. stock market. Although BTC has rebounded for several consecutive days and returned to the $83,000 level, it is still possible to drop to $73,000 in the next two months.
Stablecoins and BTC Spot ETF
Compared with the net inflow and outflow of US$1.282 billion in the dual channels last week, the supply inflow of the dual channels this week was US$237 million, and the scale of inflow was greatly reduced. Specifically, the BTC Spot ETF outflow was US$842 million, the ETH Spot ETF outflow was US$184 million, and the stablecoin inflow was US$1.264 billion.
Crypto market capital inflow and outflow statistics (eMerge Engine)
Although the inflow of stablecoins is decreasing and the outflow of ETF channels has increased, the stock funds entering the exchange are converted back into buying power, allowing the price of BTC to return to $83,000. At present, the stock funds of the exchange have rebounded slightly, which can only be regarded as a bottom-fishing behavior of a small amount of funds, and is not enough to become a force to drive the market reversal.
Selling pressure and selling
According to eMerge Engine data, short-term investors continued to sell at a loss last week, with the largest loss on March 13, but the scale was smaller than that on March 10.
In terms of floating profits and losses, the short-hand group currently bears an average loss of 9%, which includes a large number of ETF holders. In this round of decline, the short-hand group is both a triggering force and the main bearer of losses. It will continue to be under pressure in the turbulence of the market, and may also be the source of selling pressure for further declines.
Since the three-week decline, the long-term holding group has turned from reducing holdings to increasing holdings, adding about 100,000 coins. Another group worth noting is the whales, who have also increased their holdings by nearly 60,000 coins, with a cost of less than $80,000. In the long run, these two groups are always victorious and also play the role of market stabilizers.
Cycle Indicators
According to the eMerge engine, the EMC BTC Cycle Metrics indicator is 0.375, and the market is in an upward relay period.
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