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This week, BTC opened at $82,379.98 and closed at $78,370.75, falling 4.87% for the week, with a volatility of 13.92% and a significantly enlarged trading volume. BTC price is running in a downward channel, approaching the upper edge and falling under the influence of the US market over the weekend, currently stabilizing near the annual line (365 days).
On April 2nd, the US President announced a "reciprocal tariff" clause that far exceeded expectations, shocking the world. Subsequently, the Chinese government announced countermeasures. The capital market was tense, with the US three major stock indices falling sharply this week in response to the "reciprocal tariff" impact, and both long and short-term US bond yields dropped significantly.
The "reciprocal tariff" war overshadowed all other news, with the market busy selling assets and pricing downward for the unexpectedly extensive policy.
The global capital market is currently undergoing a severe adjustment and pricing process, with the biggest variable coming from the subsequent measures of the US President and the Federal Reserve.
Macroeconomic and Economic Data
On April 2nd, the US President signed an executive order at the White House, announcing "reciprocal tariffs" on global trading partners, establishing a 10% minimum benchmark tariff and imposing higher rates (such as 34%) on certain countries (like China). The benchmark tariff will take effect from April 5th, with high tariff measures to be implemented from April 9th, 2025.
US Treasury Secretary Besson called for restraint in an interview, stating that this would be the upper limit if there were no countermeasures.
On April 3rd, China responded strongly, imposing a 34% tariff on all imported goods from the US, also taking effect on April 9th.
While most small economies have yielded, the EU and UK are expected to continue to introduce some countermeasures.
Due to the significant surprise, the US three major indices quickly plummeted on Thursday and Friday to price in this development. Nasdaq, S&P 500, and Dow Jones fell 10.02%, 9.08%, and 7.86% for the week, respectively. Apple and Nvidia, directly affected by the "reciprocal tariffs", fell 13.55% and 14.01% for the week. US stocks lost over $5 trillion in market value for the week.
On April 4th, the US Department of Labor released March's non-farm employment data, with employment increasing by 228,000, far exceeding market expectations of 135,000 to 140,000. The unemployment rate slightly rose to 4.2%, slightly higher than the market's expected 4.1%. The Federal Reserve Chairman stated that the US economy remains strong and that tariffs will drag down the economy and inflation. His remarks were notably "hawkish".
Trump urged the Federal Reserve to cut rates quickly on social media, and by the weekend, the Fed Watch board showed that as US stocks plummeted, traders had increased the number of rate cuts this year to 4, with over 90% probability of a June rate cut.
The reciprocal tariff conflict will continue, but the worst moments may be passing. The market needs to gradually confirm whether pricing is adequate and whether a worse scenario might occur in the coming period.
More critically, whether "taxation promotes negotiation" exists and what the results of US negotiations with various countries will be.
Capital Flow
The crypto market saw an outflow of $333 million this week, with $178 million from the BTC Spot ETF channel and $108 million from stablecoins. The trend of net inflows for four consecutive weeks was broken.
Considering the violent fluctuations in US stocks, this outflow is not severe, but there could be additional selling pressure.
Selling Pressure and Liquidation
Accompanying US stock market turbulence, market selling pressure slightly increased, with 188,614.7 coins flowing into exchanges. Short-term holders intensified selling, while long-term holders slightly reduced selling compared to last week. According to eMerge Engine data, after three consecutive weeks of outflows, CEX BTC holdings increased by 3,116.1 coins this week, indicating some accumulation of selling pressure.
Since late February, short-term holders have mostly been in a state of floating loss, with the recent floating loss ratio reaching 16%, recording the largest floating loss in this period. Short-term holders are currently under enormous pressure, and their collapse could lead to further price drops.
Long-term holders continue to stabilize the market, increasing their holdings by 53,300 coins this week.
Unless US stocks rebound or the Federal Reserve introduces rate cuts or support measures, buying power will be difficult to significantly reverse, and the market will struggle to gain upward momentum.
Cycle Indicators
According to the eMerge engine, the EMC BTC Cycle Metrics indicator is 0.375, indicating the market is in a mid-rise period.
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