After reaching $79,000, Bitcoin has retreated to $76,500, halting its march from the late-March lows of under $65,000. Recent economic data suggests that a rapid resurgence may not be on the cards, with the University of Michigan's consumer sentiment index plummeting to a record low of 49.8 due to inflation concerns linked to the Iran conflict. Inflation expectations have also surged, with the one-year gauge 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 sharp rise in inflation expectations could limit the Federal Reserve's ability to signal interest-rate cuts, potentially capping gains in Bitcoin and other risk assets. Analysts warn that the long-term expectations move is the more concerning data point for the Fed, making a near-term easing pivot less likely.
With the Fed expected to keep interest rates steady and potential rate hikes on the horizon, traders are exercising caution. Meanwhile, the crypto market is watching for sustained ETF inflows to support Bitcoin prices, while DeFi tokens have held up relatively well despite the KelpDAO exploit. Bitcoin's hourly price chart shows a dive out of an ascending trendline, with prices trading below their 50- and 200-hour averages, indicating uptrend exhaustion and potential for a deeper price pullback.