Macroeconomic interpretation: When President Trump announced a '90-day pause' on tariff policy, the global capital markets seemed to be injected with a strong dose of adrenaline. The Dow Jones Industrial Average experienced an epic one-day increase of 7.87%, and the Nasdaq recorded its second-largest single-day surge in history. This 'tariff reprieve' that began in Washington not only revitalized traditional financial markets but also triggered a remarkable counterattack in the crypto world—Bitcoin jumped from a recent low of $74,500 to a peak of $83,588, with a 24-hour increase of over 8.7% perfectly illustrating the notion that 'one day in the crypto world is equivalent to a year in the human world.'
Tonight, the US Department of Labor is about to release the March CPI data, and savvy investors have already sensed a turning point. The soaring prices of auto insurance may become the biggest 'drama queen' of the CPI data, while tariff factors will take a back seat. This expectation management is an art, serving as a precaution for the market while leaving room for adjustments in the Federal Reserve's monetary policy. As expected, amid expectations of easing inflation pressure, the gold price surged 3.27% in one day, resonating with Bitcoin's strong rebound, forming a strategic alliance between traditional safe-haven assets and BTC at specific moments.
CPI data analysis:
The US will release key inflation indicators tonight at 20:30 (UTC+8). The year-on-year CPI for March, not seasonally adjusted, is expected to drop from 2.8% to 2.6%, while core CPI may fall to 3.0%, the lowest level in nearly four years. The uniqueness of this data lies in the fact that it is the last inflation report unaffected by tariffs before the implementation of Trump's new policies, and the market is generally focused on trends in structural price changes. According to investment bank analysis, the rising cost of auto insurance has become a major driving factor, while the effects of tariffs have yet to materialize this month.
We believe that current data may strengthen market expectations for a shift in the Federal Reserve's policy—if core inflation continues to cool, it may prompt the Fed to initiate a rate-cutting cycle earlier, thereby putting pressure on the US dollar index while boosting the valuation of risk assets. The deeper significance of this data lies in revealing the 'dual-track inflation' characteristic of the US economy: the coexistence of sticky service costs and deflationary pressures in the goods sector. This differentiated pattern may force the Federal Reserve to adopt a more refined balancing strategy when formulating policies, needing to guard against recurring service sector inflation while addressing growth risks stemming from weak manufacturing demand.
Tonight, there is also an expected value for initial jobless claims (223,000). If it exceeds the previous value of 219,000, it may create a combination of 'declining inflation + loosening employment', which could exacerbate market volatility. Historical data shows that when CPI diverges from employment and unemployment data by more than one standard deviation, the probability of the S&P 500 index experiencing more than 2% fluctuation on that day is 68%.
For the crypto market, CPI data will trigger a triple game: First, if core inflation remains unexpectedly strong, it could suppress Bitcoin's short-term performance as an inflation hedge since expectations for real interest rates will increase (the current 10-year TIPS yield has risen to 2.15%); second, if unemployment data shows a cooling labor market, it may activate the 'recession trade' logic, pushing funds towards high-risk areas like crypto assets; finally, the repricing of CME interest rate futures after the data release will directly affect the crypto derivatives market. Data from the past 12 months shows that for every 25 basis point change in Federal Reserve policy expectations, the open interest in Bitcoin futures fluctuates by up to $1.8 billion. It is important to note that structural inflation factors like auto insurance have persistence, which may further weaken the negative correlation between the crypto market and traditional assets in the second quarter.
BTC 4H market analysis report as follows:
Key support level: 77013.37 USDT
Key resistance level: 84832.37 USDT
Current trend: oscillating slightly upward
Technical indicators overview:
Moving average system: bullish arrangement. MA5 = 81946.88, MA10 = 79216.55, MA20 = 78706.69. The moving averages show a bullish arrangement, indicating a short-term upward trend.
MACD: Golden cross is in operation. DIF = 84.48, DEA = -601.80, histogram = 686.28. The MACD golden cross and the expanding histogram indicate that the market has strong bullish momentum.
BOLL: Price is above the middle track, approaching the upper track. Upper track = 83335.92, middle track = 78706.69, lower track = 74077.46, %B = 0.81%, indicating that the price is in a strong area.
RSI: Neutral to slightly bullish. RSI6 = 63.59, RSI12 = 56.93, RSI14 = 55.57, RSI24 = 51.86. The RSI indicator is in a neutral to slightly bullish area, with no overbought or oversold signals.
KDJ: Golden cross is in operation. K = 74.70, D = 66.67, J = 90.76. The KDJ golden cross and the J line being high indicate that the market has upward momentum in the short term.
I will notify everyone when there is an opportunity to get on board after the data is released tonight!
