#Powell press conference content overview#

1. Interest rate outlook: The current policy is restrictive; the next adjustment of policy interest rates is unlikely to be an interest rate increase; if interest rates are to be raised, evidence needs to be seen that the policy is insufficient to reduce inflation to the target level; if inflation becomes more persistent If the economy remains strong and the labor market remains strong, then it may be appropriate to delay a rate cut. Decisions will be made on a case-by-case basis and depend on the data; it is not known how long it will take for a rate cut; serious employment problems will be needed to respond to a rate cut.

2. Inflation outlook: Inflation is still too high and there is a lack of recent progress. The outlook is uncertain, and short-term inflation expectations have risen; gaining greater confidence in inflation may take longer than previously expected; inflation is expected to fall this year, but Confidence in this is lower.

3. Economic outlook: The labor market remains relatively tight but the balance has improved; the potential output of the U.S. economy has increased significantly due to immigration; where does the discussion of refuting the stagflation scenario come from.

4. Balance sheet reduction: Slowing down the pace does not mean that the scale of balance sheet reduction will be smaller than expected. The current slowdown is to ensure a smooth process.

Powell's press conference statements were basically one dove and one hawk. The two more important dovish statements were:

1. There is no necessary connection between the easing of financial conditions and inflation.

2. Unexpected market weakness will promote the possibility of interest rate cuts

Overall, Powell's speech was quite satisfactory, and the market also interpreted it as neutral. The probability of keeping the benchmark interest rate unchanged in June is still around 90%, and there is no obvious improvement expectation for the external environment.

ETFs experienced significant outflows yesterday. Not only GBTC, but also 10 ETFs except Hashdex were in outflow status, with a total outflow of 9,733 BTC, approximately US$560 million. The average cost of ETF investors is above 60,000. This wave of selling is a panicked hold-up. The market needs to fully absorb these bloody chips before it can continue to rise.

In terms of market conditions, Bitcoin fell below the 6w support and went directly to the 56,000 support level where MA120 is located. This is a very critical support area and the lifeline of the bull market. If it falls below, it will cause further market panic. The large level is still a bull market relay form, but after falling below 6w, a top structure appears. This will take some time to resolve, and the upward trend can be resumed only after a thorough consolidation is completed.The alt market has shown resilience, which is related to the previous rapid decline that cleared the leverage of the alt market.

Patience

[Smile][Smile][Smile]

Figure 1, ETF fund flow

Figure 2, Bull market progress