“Overall, this points to a stabilizing but still fragile ETF demand backdrop, where investors are no longer accelerating exits but are gradually repositioning capital, providing a potential floor to the downside,” the firm said.
The other notable dynamic is the decoupling of the two-year US Treasury yield, which is sensitive to Fed interest rate expectations, and WTI crude oil futures. While oil prices have plunged, the two-year yield has strengthened, hovering around 4.21% at the time of writing, the highest since February 2025 (see daily signal).
The decoupling indicates that oil and geopolitical headwinds for risk assets have been replaced by Fed rate hike expectations. Markets may expect the second-order effects of March’s oil price rise to keep inflation high in the near term, increasing the likelihood of interest rate hikes.
The Fed’s preferred inflation gauge, the core PCE, is expected to confirm the trend. According to FactSet, it is expected to have increased 0.37% monthly, raising the 12-month rate to 3.4%, which would be the highest since May 2024.
Overall, slower but still bleeding ETFs and aggressive cues from bond yields suggest lower odds of a convincing BTC price recovery in the near term.
And there’s also what Strategy, the largest publicly traded BTC holder, is doing to address concerns about the price volatility of its STRC preferred shares. Stay alert!
