"Decision-making requires logic, reason, and common sense, not emotions.
——Ray Dalio, founder of Bridgewater Associates: (Principles)
The VIX fear index has remained above 45 for four consecutive days, a phenomenon last seen in October 2008 and March 2020. Such a level of market volatility has caused severe damage to global financial markets.
With the suspension of tariffs and the gradual fading of worst-case concerns, the U.S. stock market has rebounded from the brink. Since last Friday's close, the S&P 500 has ultimately risen by 5.8%.
Currently, the key resistance levels faced by this index include the 50-day and 200-day moving averages, as well as the resistance area around 5,600 points. Once these resistances are successfully broken, bears will face immense pressure.
Research on the relationship between the Nasdaq 100 index and key moving averages: it can be observed that these moving averages may act as resistance levels in the upcoming re-break test—similar to how they served as support levels during bull markets.
The Bitcoin price chart reflects this as well!
Breaking through key moving averages and maintaining high levels signals bullishness;
Falling below key moving averages and maintaining low levels signals bearishness.
Currently, Bitcoin may again face the risk of being rejected at key moving average levels. This situation has occurred several times since February 2025, in stark contrast to the bullish trend expected in the fourth quarter of 2024.
Last week, due to the escalation of the tariff trade war, the stock market was hindered, and Bitcoin's upward potential was limited!
The Bitcoin spot ETF has also suffered a severe impact, with a net outflow of over $708 million. BlackRock's Bitcoin spot ETF, IBIT, had the largest net outflow, losing $342 million.
The bull market cycle of Bitcoin has never happened by chance. When market liquidity dries up and growth assets stagnate, Bitcoin's upward momentum also slows.
The University of Michigan's Consumer Confidence Index has plummeted!
The index has been declining since the beginning of the year and has now returned to 2022 levels, showing the impact of high inflation and its fears on consumer confidence. Although the consumer price index has not shown signs of stopping, the low sentiment may signal weakened future demand and economic growth, thereby affecting corporate profits and stock market performance.
In addition, the change in market sentiment has significant implications for Bitcoin, as stock market declines in a risk-averse environment typically drag down Bitcoin's performance.
Trump's tariff increases are far from over!
In 90 days, he may re-implement some or all of the suspended tariffs, similar to the measures he took earlier this year against Canada and Mexico.
Last week, U.S. President Trump claimed that the currently suspended national-level tariffs are 'reciprocal,' but this statement is not true. After experiencing two rounds of retaliatory tariffs, U.S. tariffs on China rose by another 91% after the announcement on April 2, with tariffs on most goods reaching as high as 145%.
This situation signifies the end of most direct trade between the world's two largest economies, completely severing most economic ties between the U.S. and China. This is undoubtedly the largest negative shock to global supply chains since the early days of the pandemic.
The current situation has led many countries and investors to sell off U.S. bonds and other assets in large quantities. When such a sell-off wave occurs in the market, the interest rates of U.S. bonds (i.e., 'yields') will rise accordingly.
Since April 4, the yield on the 10-year U.S. Treasury has climbed from 4% to about 4.5%. This change not only reflects the market's tense sentiment but also has profound implications for investor decisions.
As many issues remain unresolved, the risk of an economic recession in the U.S. is increasingly difficult to control. In such a market environment, we must always remain vigilant, keeping in mind the potential risks of bull market traps and bear market rebounds, to avoid being overly entangled in these highly volatile markets. Rational analysis and cautious decision-making will be key to coping with current uncertainties!
Note: All content represents the author's personal views and is not investment advice, nor should it be interpreted as tax, accounting, legal, business, financial, or regulatory advice in any way. You should seek independent legal and financial advice before making any investment decisions, including advice regarding tax consequences.