Buying power gradually returns, the Structural Bill encounters renewed setbacks, and Bitcoin’s mid-term breakout fails again | Bitcoin Market Analysis | Cryptocurrency | BTC

This week $Bitcoin (BTC.CC)$ Opened at $90,878.51 and closed at $93,633.53, with a gain of 3.04%, volatility of 8.76%, and trading volume continuing to increase compared to last week.

Driven by improved market risk appetite from U.S. CPI data and expectations surrounding the U.S. Market Structure Bill (Clarity Act), BTC attempted again this week to break through the $94,500 resistance level that has been in place since February, reaching a high of $97,963.62. However, following renewed complications with the Structural Bill and escalating geopolitical tensions in Greenland, a pullback occurred, failing to hold above $94,500.

On the capital front, the crypto market has seen its largest weekly inflow since the November adjustment, with over $4.3 billion flowing into the market through stablecoins, BTC ETFs, and DAT companies. Alongside a recovery in risk appetite, ETH's upward momentum slightly outpaced that of BTC.

As next week’s PCE data release approaches, the two major factors influencing the medium-term trend of BTC prices this week— inflation expectations and developments related to the Market Structure Act—will continue to act as core impact factors next week.

Policy, macro-financial, and economic data

On January 13, U.S. data showed that the unadjusted annual CPI rate for December was 2.7%, meeting expectations and matching the previous figure. The unadjusted annual core CPI rate for December stood at 2.6%, unchanged from the prior reading but lower than the expected 2.7%. Although the CPI figure was slightly below market expectations, it was not enough to drive interest rate cut expectations, but did help alleviate doubts about potential interest rate cuts in the medium-to-long term.

The same day, the seasonally adjusted annualized total of new U.S. home sales in October reached 737,000 units, surpassing the expected 720,000 units, signaling that purchasing power in the housing market is recovering after the rate cuts.

The following day, the November retail sales month-over-month figure was reported at 0.6%, higher than the expected 0.4% and also above the previous value of -0.1%, indicating that consumer market sentiment is clearly in a state of recovery and has not cooled down.

On the 15th, the U.S. reported initial jobless claims for the week ending January 10 at 198,000, lower than the expected 215,000 and also below the previous figure of 207,000, showing that the labor market remains under pressure. This supports the Federal Reserve's ability to continue pushing for lower rates into 2026.

The above economic data did not break previous market expectations or pricing — in the post-pandemic era, the U.S. economy is achieving a 'soft landing' or even a 'non-landing,' with the labor market trending cooler but still falling short of expectations. However, it is not experiencing a 'stall/deterioration' but rather a flat state of 'low layoffs, low hiring.' Further observation suggests there is no need to stimulate employment via rate cuts, as the consumer market continues to recover.

All these signals indicate that the probability of interest rate cuts has not fundamentally changed, and the market is now looking toward next week’s highly anticipated PCE data, which is also closely monitored by the Fed.

As rate-cut trading unwinds, alongside noise surrounding the Fed’s independence and chairmanship issues, long-term uncertainty premiums have increased further. U.S. Treasury yields rebounded sharply on Thursday and Friday, with the 10-year yield climbing to a high of 4.223%, putting additional pressure on long-duration assets, causing ongoing adjustments in the Nasdaq and Bitcoin (BTC).

In addition to macroeconomic and employment figures, recent impactful factors on the crypto market include the Market Structure Act (CLARITY Act). Originally scheduled for committee review on January 15, the bill was postponed after Coinbase temporarily withdrew its support; however, the committee chair described this as a 'temporary pause,' and the bill is now entering a phase of renegotiating terms.

The 'Market Structure Act' aims to define when digital assets are legally considered securities/commodities/other categories, clarifying the jurisdictional boundaries between the SEC and CFTC, and providing a clearer framework for spot market regulation, investor protection, and compliance pathways. The completion of this initiative is conducive to the healthy and orderly development of the industry and will help establish the United States as a hub for the cryptocurrency industry. As such, it has garnered significant attention from the industry and could lead to widespread allocation of crypto-assets, especially smart contract platform assets like ETH.

On the 15th, Coinbase's CEO withdrew support for the bill due to dissatisfaction with restrictions on stablecoin profit distribution. On that same day, Bitcoin (BTC) reached a high of $97,176.42 before starting a sustained decline, eventually breaking below the 90-day moving average again over the weekend, signaling a weakening mid-term trend.

As a mid-term positive catalyst, the 'Market Structure Act' will continue to provide sentiment-driven momentum to the market in the coming period.

Cryptocurrency Market

After more than two months of intense adjustment, the crypto market is entering a recovery phase.

Firstly, macro liquidity continues to improve, with funding stress significantly easing. Within the crypto market, this is reflected by capital flows shifting from outflows to inflows.

Cryptocurrency Market Capital Flow Statistics (Weekly)

This week, the overall crypto market saw an inflow of $4.344 billion, with $1.463 billion flowing into the BTC ETF channel, which is crucial for short-term pricing. Additionally, DAT companies represented by Strategy made large-scale purchases during the adjustment period, playing a supporting role in stabilizing the market.

This week, centralized exchanges saw outflows exceeding 24,000 units. From an on-chain perspective, whale and shark groups continued to act as primary buyers, providing buying power to the market.

The biggest bearish factor in the market, and a key determinant in whether the market correction qualifies as a 'deep bear' or 'cold bear,' is the reduction in holdings by long-term holders. After pausing at the beginning of the week, these holders resumed selling in the latter half, though the overall scale of selling showed signs of contraction.

For future price action of Bitcoin (BTC), whether it can effectively surpass $95,000, or even the more critical $98,000, still depends on a reduction in selling pressure from long-term holders, or their shift back towards accumulation.

Moreover, speculative impulses triggered by market preferences and the progress of the Market Structure Act are also sources of medium- to short-term momentum in the market.

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 have launched the only virtual asset fund approved by the Securities Regulatory Commission to accept stablecoin subscriptions—the Victory EMC BTC Cycle Fund. EMC Labs was co-founded by seasoned virtual asset investors and data scientists, with its core team hailing from JD.com, Bell Labs, and Marsbit. EMC Labs has invested substantial resources into building professional engines for analyzing on-chain BTC data and technical indicators.

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