Crypto Assets Market Weekly Report: BTC has fallen back to the annual line, global Capital Market is turbulent (03.31~04.06)

This week, Bitcoin opened at $82379.98 and closed at $78370.75, down 4.87% for the week, with a volatility of 13.92% and a noticeable increase in trading volume. The price of Bitcoin is operating in a descending channel, and after approaching the upper edge of the channel, it was influenced by U.S. policies and broke down over the weekend. It is currently stabilizing near the yearly line (365 days ).

On April 2, the U.S. government announced the implementation of an unexpectedly new tariff policy, causing a global shock. Subsequently, the Chinese government announced corresponding countermeasures. The Capital Market experienced significant volatility, with the three major U.S. stock indexes sharply declining this week in response to the impact of the new policy, and U.S. bond yields across all maturities significantly decreased.

The impact of the new tariff policy has overshadowed all other news, with the market busy selling off assets and repricing this unexpected policy.

The global capital market is currently undergoing significant adjustments and repricing, with the biggest variable coming from the subsequent responses of the U.S. government and the Federal Reserve.

Macroeconomics and Financial Data

On April 2, the U.S. government announced a new tariff policy for global trading partners, establishing a minimum baseline tariff of 10%, with higher rates imposed on certain countries. The baseline tariff will take effect on April 5, while the higher rate measures will be effective from April 9, 2025.

The US Treasury Secretary has urged countries to exercise restraint and stated that this will be the limit if there is no countermeasure.

On April 3rd, China announced a 34% tariff on all imported goods originating from the United States, effective from April 9th.

Although some small economies choose to endure the new policies, it is expected that the EU and the UK will continue to introduce certain countermeasures.

Due to policies exceeding expectations, the three major U.S. stock indices plummeted rapidly during the trading days on Thursday and Friday. The Nasdaq, S&P 500, and Dow Jones index fell by 10.02%, 9.08%, and 7.86% respectively over the week. The stock prices of tech giants directly affected experienced even larger declines, with the total market value of U.S. stocks evaporating by over $5 trillion for the week.

The U.S. non-farm payroll data for March, released on April 4, showed an increase of 228,000 jobs, far exceeding market expectations, while the unemployment rate rose slightly to 4.2%. The Federal Reserve Chairman stated that the U.S. economy remains strong, but the new tariff policy will weigh on the economy and inflation. His remarks are considered quite "hawkish".

The U.S. government urges the Federal Reserve to lower interest rates as soon as possible. As of the weekend, the market expects the Fed to cut rates 4 times this year, with a probability of more than 90% for a rate cut in June.

The impact of the new tariff policy will persist, but the worst period may be behind us. The market needs to gradually confirm over the next period whether pricing is sufficient and whether more severe situations will arise. More critically, whether the new policy is intended to promote negotiations and the results of negotiations between the United States and various countries.

Capital Flow

The crypto assets market saw an outflow of funds reaching $333 million this week, with $178 million flowing out of Bitcoin spot ETFs and $108 million out of stablecoins. The trend of net inflows for the previous four weeks has been broken.

Considering the severe fluctuations in the US stock market, this scale of outflow is not serious, but there may be additional sell-offs in the future, which requires vigilance.

Market Selling Pressure and Sell-off Situation

With the turbulence in the US stock market, market selling pressure has slightly increased, and the number of Bitcoins flowing into exchanges on-chain has reached 188614.7 coins. Short-term holders are intensifying their sell-off, while long-term holders have slightly reduced their selling compared to last week. Data shows that after three consecutive weeks of outflows, the number of Bitcoins held by centralized exchanges has increased by 3116.1 coins this week, indicating that selling pressure has accumulated.

Since late February, the short-term holders have been in a state of unrealized loss for most of the time, with the recent unrealized loss ratio reaching 16%, setting a record for the largest unrealized loss in this cycle. The short-term holders are currently still under great pressure, and their collapse could lead to further price declines.

Long-term holders continue to play a stabilizing role in the market, with an increase of 53,300 coins in holdings this week.

Unless the US stock market rebounds or the Federal Reserve implements easing policies such as interest rate cuts, the buying power is unlikely to significantly increase, and the market will struggle to gain upward momentum.

Market Cycle Indicators

According to market data, the current Bitcoin cycle indicator is 0.375, indicating that the market is in an ascending continuation phase.