BTC Weekly Review: Market Fluctuation Intensifies, Short-Term Outlook Uncertain

This week, Bitcoin experienced significant fluctuations, with the price dropping from $94265.47 to $80699.17, a weekly decline of up to 14.39% and an amplitude of 15.29%. This is the second largest weekly drop in this cycle, reflecting a significant shift in market sentiment.

The main reason for the significant pullback in BTC is the uncertainty surrounding the economic outlook in the United States. U.S. stocks began trading on "recession" expectations, giving back previous gains. This sentiment has spread to the cryptocurrency market, leading to the largest outflow of funds from the BTC spot ETF since its inception.

However, the policy environment for the cryptocurrency industry in the United States is gradually improving. Some state governments are promoting bills that are favorable to BTC development, which provides a positive signal for long-term growth. However, in the short term, investor sentiment still dominates the market direction.

On the technical side, Bitcoin has broken through several important support levels, including the "Trump Bottom" and the 200-day moving average. The Fear and Greed Index has fallen to an "Extreme Fear" level, reflecting a pessimistic market sentiment.

The U.S. non-farm payroll data released on Friday showed a slowdown in the labor market, with a slight increase in the unemployment rate. The Federal Reserve Chairman then gave a speech, suggesting that the current interest rate level may be maintained, but also not ruling out the possibility of future rate cuts. This information has led to an increase in market expectations that the Federal Reserve may cut rates three times this year.

From the perspective of capital flow, the overall cryptocurrency market saw a slight net inflow this week, but Bitcoin spot ETFs are still experiencing continuous outflows. On-chain data shows that the market is overall still in a profitable state, but short-term holders are under pressure.

Looking to the future, the trend of Bitcoin may continue to be constrained by the performance of the US stock market and the overall economic environment. The market is currently in an oversold state in the short term, but reversing the downward trend may require more positive factors for support. Investors should closely monitor US economic data and policy changes, and carefully assess market risks.