Macroeconomic headwinds, withdrawal of incremental funds, BTC rebound fails | Bitcoin | Deep bear market | Research report | Cryptocurrency market analysis

This week, $Bitcoin (BTC.CC)$ Opened at $72,830.01, closed at $70,710.02, with a high of $76,022.60 and a low of $68,772.78. The decline was 2.91%, with trading volume shrinking for the third consecutive week.

Last week's macro financial pressures weighed heavily, $Bitcoin (BTC.CC)$ After a strong rebound against headwinds, the worsening macroeconomic conditions caused capital flows in the crypto market to shift from inflows to outflows this week. Macro liquidity and risk appetite once again became the dominant factors driving the crypto market.

This week, the PPI data released by the US exceeded expectations significantly. Meanwhile, following the escalation of the US-Iran conflict, the situation in the Strait of Hormuz deteriorated further, causing crude oil futures to continue rising. Some traders have started speculating that the Federal Reserve will raise interest rates in 2026.

The renewed acceleration of inflation and the sharp decline in rate-cut expectations weakened overall risk assets; the macro headwinds failed to provide support for risk appetite; $Bitcoin (BTC.CC)$ Within the crypto market, after ETFs saw short-term net inflows and stablecoin supply expanded, subsequent funding fell short, $Bitcoin (BTC.CC)$ making it difficult to gain support above $75,000.

The brief one-week independent rally has ended, $Bitcoin (BTC.CC)$ This week, the market returned to volatility around the $70,000 level. The 'deep bear market' phase continues to show significant unrealized losses and cooling trading sentiment. Unless the US-Iran conflict ends soon, expectations of rate cuts and risk appetite are unlikely to recover, $Bitcoin (BTC.CC)$ In the medium term, prices will likely continue to seek support at lower levels.

Macro Finance

The key characteristic of the macro environment this week is the coexistence of improved liquidity and tightening financial conditions . On one hand, the Federal Reserve's net liquidity rebounded, with a week-on-week increase of 1.12%. SOFR dropped to 3.62%, declining 0.18% for the week, indicating marginal improvement in basic liquidity supply and some easing of short-term funding pressure. On the other hand, PPI year-over-year rose to 3.4% (from 2.9%), month-over-month rising to 0.7% (from 0.5%), strengthening expectations of renewed inflation acceleration and prompting the market to revise interest rate path forecasts higher.

The yield on 2-year US Treasury bonds rose to 3.9%, up 4.87% for the week; the yield on 10-year US Treasury bonds rose to 4.394%, up 2.74% for the week. The US Dollar Index remained largely flat, suggesting that the tightening of financial conditions this week was primarily driven by interest rates rather than exchange rates. The implication is: while there has been some recovery in the quantity of liquidity, the constraint from interest rates as the discounting factor in asset pricing is stronger, preventing the market from confirming 'easing' trades.

The performance of risky assets further validates this point. The S&P 500 fell 0.55% for the week, Nasdaq fell 2.07%, Dow Jones fell 2.11%, and Russell 2000 fell 1.68%. The larger drop in Nasdaq indicates that assets with longer durations and more sensitive valuations reacted most strongly to rising interest rates. In other words, this week’s macro environment did not create tailwinds for BTC; its impact on BTC is more akin to downward pressure rather than upward momentum.

The ongoing US-Iran conflict, worsening passage conditions through the Strait of Hormuz, has led more funds to start betting on a rebound in inflation. A Fed rate cut seems far off, and some funds have even started pricing in a rate hike in 2026.

All signs indicate that macro headwinds will persist. With the US Dollar Index showing signs of stabilization around 100 and the 10-year US Treasury yield approaching 4.4%, the three major US stock indexes have technically broken below their 200-day moving averages. EMC Labs analysis suggests that if the US-Iran conflict does not converge in the short term, the more than four-month-long sluggishness in US stocks will lead to a moderate correction.

Cryptocurrency market

In contrast to macro constraints, this week $Bitcoin (BTC.CC)$ the market structure exhibited clear characteristics of spot-driven expansion.

In terms of funding sources, the most critical driver this week came from incremental capital entering from outside the market. $Bitcoin (BTC.CC)$ ETFs recorded net inflows in the first two trading days, but began to experience continuous outflows on the third trading day as US stocks broke down; at the same time, stablecoin supply increased by $2.056 billion for the week, with a single-day net inflow reaching $929 million on March 9th. The implication of this combination is very clear: both upward and downward movements were not caused by the rotation of existing funds within the market, but rather by the entry and exit of external purchasing power.

Derivatives were not the root cause of this round of rises and falls, but more like amplifiers. Open interest once increased by $2.691 billion, a rise of 5.31%, indicating that leverage participation did indeed recover; however, funding rates remained negative or near zero, without rising in tandem with price increases, suggesting that the market has not formed typical crowded long positions. On the contrary, there are still short hedging or counter-trend suppressing positions in the futures market, and during the price breakout process, short liquidations passively amplified the gains; the peak short liquidation on March 13th verified this. Therefore, the more accurate structural definition for this week should be: spot-driven, leveraged amplification, but leverage itself did not spiral out of control.

The on-chain structure also supports this judgment. The overall MVRV rose to 1.31, while the long-term holder MVRV rose to 1.66, indicating that profit recovery for coin holders is underway but has not yet entered a historically overheated zone. Although the short-term holder MVRV rebounded from 0.76 to 0.83, it remains below 1, meaning that short-term holders as a whole have not yet broken even, and the market has not reached the stage of loss resolution. Meanwhile, BTC balances on exchanges dropped by 26,500, LTH (long-term holder) supply remained largely flat, and STH (short-term holder) balances increased by 26,900, reflecting that new chips were absorbed more by new marginal holders and custodial systems rather than being distributed centrally by long-term holders. SOPR as a whole remained slightly below 1, also indicating limited realization intention on-chain.

Based on the above signals, the market phase this week was closer to a short-term rebound triggered by bottom-fishing funds entering after selling pressure waned, but losses remain very severe, and as buying power dissipates, prices quickly retreated.

Trend Analysis

This week, $Bitcoin (BTC.CC)$ the logic of the rally mainly stemmed from improvements in the internal capital structure of the crypto market, rather than a warming macro environment. This means $Bitcoin (BTC.CC)$ There is no resonance between the macro financial conditions and the crypto market; instead, they present a noticeable divergence and hedging relationship: the macro side exerts pressure via interest rates and subdued risk appetite, whereas the crypto side counters this with net inflows into ETFs, stablecoin expansion, and spot market absorption.

This structure has two important implications. First, it indicates that $Bitcoin (BTC.CC)$ the current upward momentum exhibits a certain independence, with prices not entirely reliant on the synchronized strength of traditional risk assets. Internal capital expansion alone is sufficient to support a transition from recovery to expansion. Second, it suggests that the fragility of the current market trend does not lie in on-chain profit-taking or overheated long leverage, but rather in whether external capital flows can continuously offset macro discounting pressures. In other words, the strongest aspect of the current market is: genuine buying interest exists, selling pressure has not been released en masse, and leverage shows no obvious bubble; the main constraint, however, remains that macro financial conditions are still relatively tight, $Bitcoin (BTC.CC)$ and have yet to receive confirmation from an improved external risk appetite environment.

Short-term outlook

The judgment on short-term movements should be based not on directional predictions but on structural validation. First, if the macro environment improves and net inflows into ETFs along with stablecoin expansion continue, this would indicate that the core buyer base for this rally remains intact, $Bitcoin (BTC.CC)$ with conditions in place to sustain spot-driven expansion. Second, if the STH MVRV (short-term holder realized value) continues to recover and rises effectively above 1 without a significant surge in exchange inflows or SOPR (Spent Output Profit Ratio), it would imply that the market can continue to absorb new supply after cost recovery, thereby strengthening the structure.

Conversely, if interest rates on the macro side continue to rise rapidly and re-accelerating inflation further dampens market expectations for a dovish policy path, the current structure of 'internal capital hedging macro pressures' will face greater discounting constraints. If, simultaneously, ETF inflows slow and stablecoin expansion weakens, $Bitcoin (BTC.CC)$ the foundation for independent upward movement will be undermined. The current situation aligns more closely with this assumption.

The above analysis is provided by EMC Labs.

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About EMC Labs

EMC Labs is a partner of Victory Securities, and together they launched the only virtual asset fund approved by the SEC that accepts stablecoin subscriptions — the Victory EMC BTC Cycle Fund. EMC Labs was co-founded by experienced virtual asset investors and data scientists, with a core team from JD.com Finance, Bell Labs, Marsbit, and other companies. EMC Labs has invested substantial resources into building professional engines to analyze BTC on-chain data and technical indicators.

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