Bitcoin price rebounds to a key position, market welcomes positive signals

This week, the opening price of Bitcoin was $82562.50, and the closing price was $86092.94, with a weekly increase of 4.28% and a volatility of 7.71%. This marks the second consecutive week of gains, but the trading volume has decreased for three consecutive weeks. Currently, the price of Bitcoin is operating within a descending channel and is approaching the upper edge of the channel.

The Federal Reserve released dovish signals in this week's interest rate meeting, indicating that it would take intervention measures if economic issues arise and hinted at two possible rate cuts this year. This statement stabilized the US stock market, accompanied by a large influx of funds into ETFs, while Bitcoin also stabilized and rebounded to the upper edge of the descending channel.

As the US is set to release PCE data next week, the Bitcoin price is facing 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 borrowing rate in the range of 4.25% to 4.5%. The Federal Reserve also hinted at a possible 50 basis point rate cut in 2025 and announced an adjustment to the pace of its bond reduction.

The Federal Reserve Chairman stated that they have lowered their economic growth expectations and pointed out that tariff policies are the main factor driving up inflation. For the U.S. stock market, which has fallen for three consecutive weeks, the Federal Reserve has sent an important signal — if the economic situation worsens, they will take action.

Starting from April 1, the Federal Reserve will slow down the pace of asset reduction, adjusting the cap on the reduction of U.S. Treasuries from $25 billion to $5 billion per month. This move is seen as a boost to the bond market. The Federal Reserve's relatively "dovish" response to the market decline indicates that while it aims to meet inflation targets, it is also closely monitoring employment and stock market stability to prevent a larger crisis.

Although fundamental issues such as economic stagflation have not been resolved, the market has begun to stabilize and rebound. The dollar index rose by 0.25% over the week. The Nasdaq index, S&P 500 index, and Dow Jones Industrial Average rose by 0.17%, 0.51%, and 1.2%, respectively. The yields on 2-year and 10-year U.S. Treasury bonds fell by 1.59% and 1.39%, to 3.9670% and 4.2580%, respectively.

Some funds continue to choose safe-haven gold. London gold has achieved a three-week consecutive rise, increasing by 1.23% this week, closing at 3023.31 USD/oz.

Cryptocurrency Market Dynamics

In terms of capital flow, Bitcoin spot ETFs have shown breakthrough signals. After falling for five consecutive weeks, this week has seen positive inflows, with all five trading days recording net inflows totaling $1.05 billion. This large-scale inflow has provided strong support for the rebound of Bitcoin prices.

In terms of stablecoins, there was an inflow of 958 million USD throughout the week. A total of 1.95 billion USD flowed in from all channels, providing strong support for a market full of uncertainty.

With the price rebound, market selling pressure has significantly weakened to 114,992 Bitcoins. Data shows that this week long-term holders sold 3,284 coins, while short-term holders sold 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 holders is continuously being absorbed, indicating that long-term investors have a favorable attitude towards the current price.

According to the market cycle indicators, Bitcoin is currently in a rising continuation phase.

As market sentiment improves and capital inflows increase, Bitcoin prices have stabilized and rebounded at key levels. However, future trends still need to closely monitor macroeconomic data and capital flow directions.