Bitcoin Bulls Face Hurdles as Macro Trends Signal Caution

After reaching $79,000, bitcoin has retreated to $76,500, pausing its rally from the late-March low of $65,000. 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 plummeted to a record low of 49.8, driven by inflation concerns related to the Iran conflict. Inflation expectations have also jumped, with the one-year gauge rising to 4.8% in April, up from 3.8% the previous month. Long-term expectations have increased to 3.5%, the highest since October 2025. This sharp rise could limit the Federal Reserve's ability to signal interest-rate cuts, potentially capping gains in BTC 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. The Fed is expected to maintain its benchmark interest rate between 3.5% and 3.75% this Wednesday. Meanwhile, traders are pricing in a potential Bank of Japan rate increase in June. Sustained ETF inflows remain crucial to supporting spot BTC, while coordinated industry efforts have helped DeFi tokens hold up better than the broader market. The CoinDesk DeFi Select Index gained 0.5% over 24 hours, decoupling from the CoinDesk 20's 1.5% decline. Bitcoin's hourly price swings show a dive out of an ascending trendline, with prices trading at a discount to their 50- and 200-hour averages, indicating uptrend exhaustion and potential for a deeper price pullback.