bitcoin It retreated to $76,500 from above $79,000 earlier this week, halting the rally from late March lows below $65,000. Those hoping for a quick return to normal may want to take note that recent economic releases do not support a big bullish move.
The most important is the University of Michigan Consumer Survey, which showed the consumer confidence index fell to a record low of 49.8 this month, driven largely by inflationary pressures linked to the conflict with Iran.
Inflation expectations also rose sharply, with the one-year indicator rising to 4.8% in April from 3.8% the previous month. Long-term expectations (five to ten years) have risen to 3.5%, the highest reading since October 2025.
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Inflation expectations can become self-fulfilling, which is why central banks like the Federal Reserve keep a close eye on them and try to anchor them. Therefore, the sharp rise could limit the Federal Reserve’s ability to signal interest rate cuts or liquidity easing in the near term, as additional monetary easing risks reinforcing inflationary pressures. That aggressive tilt could, in turn, limit upside gains or slow down BTC and other risk assets.
“For the Federal Reserve, the movement in long-term expectations is the most dangerous data point. It is the variable the central bank watches most closely when assessing whether inflation psychology is becoming unanchored, and a change of this size in one month raises the bar for any near-term easing shift, even as the real economy weakens at the margin,” the Bitfinex analysts said.
The Federal Reserve is expected to keep its benchmark interest rate stable between 3.5% and 3.75% this Wednesday.
Meanwhile, traders are also pricing in a possible rate hike from the Bank of Japan in June.
“Rate hikes this month seem unlikely, based on current market sentiment. Financial bets suggest we could see more than two rate hikes in the eurozone and the UK before the end of the year. A rate hike in June is almost entirely in the cards. We now lack clarity in the data to make good decisions, and that is the main impediment,” Timothy Misir, head of research at BRN, said in an email.
On the crypto side, sustained ETF inflows remain crucial to maintaining BTC spot support on dips.
Meanwhile, the industry’s coordinated efforts to contain the fallout from the KelpDAO exploit have helped DeFi tokens hold up better than the broader market. The CoinDesk DeFi Select Index gained 0.5% in 24 hours, decoupling from the CoinDesk 20’s 1.5% drop. Stay alert!
Read more: For an analysis of current activity in altcoins and derivatives, see Crypto Markets Today. For a complete list of this week’s events, check out CoinDesk’s “Crypto Week Ahead.”
What is trend?
Today’s sign
The chart shows hourly bitcoin price swings in candlestick format since the end of March.
BTC has broken out of an ascending trend line (white dashed line) that guided its upward trajectory since the beginning of this month. Additionally, prices are quoted at a discount to their 50- and 200-hour averages.
That setup points to the exhaustion of the uptrend and the possibility of a deeper price pullback. The bullish argument would be reaffirmed if prices recover both moving averages.
