Federal Reserve Chairman Powell reiterated a 'wait and see' policy stance during a press conference in the early hours of May 8, Beijing time, maintaining the federal funds rate in the range of 4.25%-4.5% for the third consecutive time, emphasizing the complex situation of economic resilience coexisting with inflation risks. He stated that although the impact of the Trump administration's tariff policy exceeded expectations, the Federal Reserve would not rush to adjust interest rates but would wait for more data before making decisions. Powell also stressed the independence of the Federal Reserve multiple times, stating that 'the president's call for interest rate cuts will not affect our work' and made it clear that he has never actively sought a meeting with the president.
Regarding the trend of Bitcoin prices, Powell's dovish comments (retaining the possibility of rate cuts) temporarily boosted risk asset sentiment in the short term, leading to a brief surge in Bitcoin after his speech, but it later entered a volatile pattern as the market digested expectations. Analysts generally believe that uncertainty about Federal Reserve policy and concerns over Trump's trade policies will continue to dominate short-term fluctuations, and Bitcoin may maintain high volatility.
In the medium to long term, the trend of Bitcoin will depend on multiple factors:
1. Macroeconomic environment: If the Federal Reserve initiates interest rate cuts in the second half of the year, liquidity easing may favor risk assets such as Bitcoin; however, if inflation rebounds and forces the Federal Reserve to maintain high rates, it could suppress market risk appetite.
2. Regulatory policies: Although the 'strategic Bitcoin reserve' plan promoted by the Trump administration has not led to large-scale accumulation, local governments such as New Hampshire have begun to allocate Bitcoin, which may gradually change the market supply and demand structure. Institutions like Standard Chartered Bank predict that by the end of 2025, Bitcoin could hit $200,000, but there is a need to be wary of risks from sudden policy changes.
3. Technical factors and capital flows: Currently, the Bitcoin derivatives market has over $2.8 billion betting on an upward trend, and the TD Sequential indicator shows buy signals, but on-chain data indicates selling pressure near the cost bottom of short-term holders, requiring attention to the sustainability of capital inflows.
Overall, Bitcoin may maintain volatility in the short term, while in the medium to long term, it still has upward potential under favorable policies and institutional entry, but close attention should be paid to Federal Reserve policy direction, tariff negotiation progress, and key technical level breakthroughs. Investors should remain cautious and flexibly adjust strategies in conjunction with support and resistance levels.
