Bitcoin Bulls Face Resistance as Macro Factors Weigh on Price

After reaching highs above $79,000, Bitcoin has retreated to $76,500, stalling its rally from late March lows below $65,000. Recent economic data suggests that a swift resurgence may be unlikely. The University of Michigan's consumer sentiment index has fallen to a record low of 49.8, driven by inflation concerns related to the Iran conflict. Inflation expectations have also increased, with the one-year gauge rising to 4.8% in April, up from 3.8% the previous month. Long-term expectations have reached 3.5%, the highest since October 2025. This surge in inflation expectations could limit the Federal Reserve's ability to cut interest rates or ease monetary policy, potentially capping gains in Bitcoin and other risk assets. Analysts note that the sharp rise in long-term expectations is particularly concerning for the Fed, as it may indicate that inflation psychology is becoming unanchored. With the Fed expected to maintain its benchmark interest rate this Wednesday, traders are also anticipating a potential rate increase by the Bank of Japan in June. Meanwhile, sustained ETF inflows are crucial for supporting Bitcoin's spot price, while coordinated industry efforts have helped DeFi tokens hold up relatively well despite the KelpDAO exploit. Bitcoin's price has broken out of an ascending trendline, trading below its 50- and 200-hour averages, suggesting uptrend exhaustion and potential for further price declines.