Bitcoin Bulls Face Resistance as Macro Trends Signal Caution

After reaching above $79,000 earlier in the week, Bitcoin has retreated to around $76,500, pausing its rally from the late-March lows below $65,000. However, those anticipating a rapid recovery should note that recent economic data does not support a significant bullish surge. The University of Michigan's Consumer Sentiment Index has dropped to a record low of 49.8, driven primarily by inflation concerns related to the Iran conflict. Inflation expectations have also increased, with the one-year outlook jumping to 4.8% in April from 3.8% the previous month, and long-term expectations rising to 3.5%, the highest since October 2025. This rise in inflation expectations could limit the Federal Reserve's ability to signal interest rate cuts or liquidity easing, as additional monetary easing may exacerbate inflationary pressures, potentially capping gains in BTC and other risk assets. Analysts warn that the Fed is closely monitoring these expectations, and a significant shift could raise the bar for any near-term easing. The Fed is expected to maintain its benchmark interest rate between 3.5% and 3.75% this Wednesday, while traders are also anticipating a potential Bank of Japan rate increase in June. In the crypto market, sustained ETF inflows are crucial for supporting spot BTC prices, and coordinated industry efforts have helped DeFi tokens hold up relatively well despite the KelpDAO exploit. The CoinDesk DeFi Select Index has gained 0.5% over 24 hours, outperforming the broader market. Bitcoin's hourly price swings have broken out of an ascending trendline, and prices are trading below their 50- and 200-hour averages, indicating potential for a deeper price pullback.