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Fed’s caution vs market optimism: What’s the real story? Could Bitcoin to US$120K be it?

Fed’s caution vs market optimism: What’s the real story? Could Bitcoin to US$120K be it?

I reflect on the whirlwind of economic and market developments from last week and cast an eye toward what’s coming, and it’s clear we’re in a fascinating moment. The financial world feels like it’s teetering on the edge of something big—optimism tempered by uncertainty, bold moves shadowed by lingering risks.

Let’s dive into what happened last week, what it means, and what we might expect in the days ahead, weaving together the threads of global trade, monetary policy, housing, and even the wild ride of Bitcoin. This is my take, grounded in the facts and data at hand.

Last week: A rally fuelled by trade relief and resilience

Last week kicked off with a bang. Markets opened with a decisive gap above the 200-day moving average—a technical signal that traders love to see, often interpreted as a sign of sustained bullish momentum. The catalyst? A breakthrough in the US-China trade saga. After months of tension, the two economic giants agreed to a 90-day suspension of most tariffs.

US duties on Chinese goods dropped from a staggering 145 per cent to a more manageable 30 per cent, while Chinese tariffs on US imports fell from 125 per cent to 10 per cent, with some categories excluded. This wasn’t a full resolution—those exclusions hint at sticking points yet to be ironed out—but it was a lifeline for markets that trade war fears had battered. Investors exhaled, and you could almost feel the relief rippling through Wall Street.

The numbers back this up. The S&P 500 and Nasdaq logged their strongest single-day gains since early April, and the Dow surged over 1,100 points on Monday alone. By Friday, major indexes were trading within five per cent of their all-time highs. That’s no small feat when you consider the headwinds of the past year—supply chain disruptions, inflation spikes, and geopolitical uncertainty. The tariff truce, announced after negotiations in Geneva, seemed to flip a switch, turning fear into opportunity.

Tuesday added fuel to the fire. A cooler-than-expected Consumer Price Index (CPI) print hit the wires, suggesting that inflation might not be the runaway train some had feared. Lower inflation readings ease pressure on the Federal Reserve to slam the brakes with aggressive rate hikes, and that’s music to investors’ ears. The rally accelerated, with stocks climbing higher as the week progressed. It wasn’t all smooth sailing, though.

Later in the week, Fed Chair Jerome Powell threw a bit of cold water on the party. His tone was neutral at best, hawkish at worst, as he pointed to persistent supply shocks and hinted at a higher long-run rate path. In plain English, he’s saying the Fed might need to keep rates elevated longer to tame inflation and stabilise the economy. That could’ve rattled markets, but it didn’t. Risk appetite held firm, which tells me investors were more focused on the trade win than the Fed’s cautious outlook. It’s a testament to the momentum at play—bullish sentiment was too strong to be derailed.

Looking ahead: Housing, Fed signals, and global pulse points

Now, let’s shift gears and look forward. The coming week feels like a crossroads. We’ve got a slew of data and events that could either cement this bullish run or throw a wrench into it. One area I’m particularly curious about is housing.

Earnings from Home Depot and Lowe’s, coupled with April home sales data, are due out soon, and they’ll be a litmus test for the real estate market. Housing is a huge piece of the economic puzzle—when it’s strong, it signals consumer confidence and spending power; when it’s weak, it can drag everything else down. Interest rates have been a rollercoaster, and buyers have been skittish.

If these reports show resilience—say, steady sales or upbeat guidance from the home improvement giants—it could bolster the case that the economy’s on solid footing. But if they disappoint, it might spark worries about a slowdown. Traders will be watching closely, and so will I.

The Federal Reserve isn’t stepping out of the spotlight either. We’ve got a packed lineup of Fed speakers this week, and their words could move markets. Powell’s recent comments already stirred the pot, and now his colleagues have a chance to elaborate—or pivot.

Then there’s Thursday’s flash Purchasing Managers’ Index (PMI) data, which gives a snapshot of business activity. Strong PMIs could reinforce the bullish vibe; weak ones might signal trouble ahead. These events can reset expectations; in a market, this jittery is no small thing. We’ll see some volatility as investors parse every word and number.

Monday’s spotlight: A glimmer of economic hope?

Let’s zoom in on Monday, May 19, 2025. At 14:00 GMT, April’s US Conference Board Leading Economic Index (LEI) drops. This is one of those forward-looking indicators that economists love—it’s designed to predict where the economy’s headed over the next six to twelve months. It fell by 0.7 per cent in March, which wasn’t great news; a decline signals contraction. The forecast for April is a smaller drop of 0.2 per cent. That’s still negative, but the narrower slide caught my eye.

Could it mean the pace of economic deceleration is slowing? Maybe. If the data comes in as expected—or better—it might suggest recessionary pressures are easing. I think stronger corporate earnings or loosening credit conditions could be at play here, giving businesses and consumers more breathing room. The LEI’s still in the red, so we’re not out of the woods, but a less-bad number could lift spirits. I’ll be checking that release at 2:00 PM GMT with interest.

On the earnings front, we’ve got Diageo and Trip.com reporting. Diageo’s a heavyweight in the alcoholic beverages world, and its results could tell us how consumers are spending on discretionary items like a bottle of Johnnie Walker. Trip.com, a big name in China’s online travel scene, might shed light on whether travel demand is holding up amid economic shifts. These aren’t make-or-break for the broader market, but they’re pieces of the puzzle—clues about how people feel and spend.

Tuesday’s global view: Rates, inflation, and trade

Tuesday, May 20, brings a trio of international events worth watching. First up, at 04:30 GMT, the Reserve Bank of Australia (RBA) announces its interest rate decision. The current rate sits at 4.1 per cent, but the buzz is they’ll cut it to 3.85 per cent. That’s a notable shift. Australia’s economy has been grappling with slowing growth, weaker consumer spending, and cooling inflation.

Recent data showing a softening labor market and sluggish wage growth backs this up—households are stretched, and the RBA might see a rate cut as a way to juice demand and fend off a deeper slump. If they go through with it, it could ripple beyond Australia, maybe nudging other central banks to rethink their own stances. Global markets will take note.

Later, at 12:30 GMT, Canada’s Inflation Rate Year-over-Year hits the docket. Inflation’s been a hot topic everywhere, and this number will tell us if Canada’s price pressures are easing or digging in. A lower reading could ease fears of aggressive rate hikes from the Bank of Canada, while a stubborn one might stoke them.

Then, at 23:50 GMT, Japan’s Balance of Trade data rolls out. Japan is a trade powerhouse, and this shows how its exports and imports are stacking up. With global supply chains still shaky, a surplus could signal resilience; a deficit might hint at trouble. Together, these data points paint a picture of the world economy—interconnected and complex.

Bitcoin’s big moment: US$120K in sight?

Now, let’s talk Bitcoin, because it’s impossible to ignore. On May 18, 2025, it was trading at US$103,895, with a market cap of US$2.064 trillion. That’s a colossal figure, hovering near all-time highs, bouncing between US$102,771 and US$104,002 in a tight consolidation range.

As I write this, it’s ticked up to US$104,826. The 24-hour trading volume—US$19.865 billion—shows plenty of action. What’s driving it? Bitcoin’s got this uncanny knack for thriving whether markets are in risk-on or risk-off mode, a point Bitcoin Suisse has flagged. Its Sharpe ratio, a measure of risk-adjusted returns, sits at 1.72, second only to gold. That’s a big deal—it’s saying Bitcoin’s maturing, delivering solid gains without wild swings.

The market’s buyer-heavy right now, with institutional players and retail investors piling in. That could tighten supply and push prices higher. I’m starting to think the odds of Bitcoin cracking US$120,000 in May are climbing. And it’s not just market dynamics—there’s news fuelling this too.

Ukraine is planning a National Bitcoin Reserve, with lawmaker Yaroslav Zhelezniak finalising the legislation. That’s a bold move, mirroring US efforts to do the same, and it screams adoption. Then there’s American Bitcoin, the Trump family’s crypto venture, announcing plans to go public via a Nasdaq merger. Love them or not, the Trumps bring attention, and this could legitimise crypto further. If these dominoes fall right, we might see a rally that takes Bitcoin to new heights. 

My take: Optimism with eyes wide open

So, where does this leave us? Last week was a shot in the arm for markets—trade relief sparked a rally that held up against Fed hawkishness. The bullish momentum feels real, with indexes knocking on the door of record highs.

Looking ahead, I’m cautiously optimistic. Housing data and Fed signals will be key—if they hold steady, this run could keep going. The LEI’s smaller drop and the RBA’s potential rate cut suggest economies adapt, not collapse. And Bitcoin? It’s a wild card that might steal the show.

But I’m not blind to the risks. Powell’s warnings about supply shocks and rates aren’t idle chatter, and a stumble in housing or PMIs could shake things up. For now, though, the data’s tilting positive, and the vibe is upbeat.

I’ll be watching Monday’s LEI, Tuesday’s global releases, and Bitcoin’s next move like a hawk—because in this market, every moment counts. What do you think—am I onto something, or is there a curveball I’m missing? Let’s keep the conversation going.

I must emphasise again that Bitcoin at US$120,000 is just my humble prediction.

 

Source: https://e27.co/feds-caution-vs-market-optimism-whats-the-real-story-could-bitcoin-to-us120k-be-it-20250519/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

US tariffs vs crypto wins: An economic shift

US tariffs vs crypto wins: An economic shift

I’ve been closely following the unfolding events surrounding President Trump’s announcement of a 25 per cent tariff on all autos manufactured outside the United States, set to take effect on April 2, 2025. This decision, coupled with the ripple effects across financial markets, commodities, and the cryptocurrency sector, paints a complex picture of risk, opportunity, and uncertainty.

My perspective on this topic is shaped by a careful analysis of the data, historical precedents, and the broader implications for both traditional and decentralised financial systems. What we’re witnessing is a pivotal moment where geopolitics, trade policy, and technological innovation are colliding, with far-reaching consequences for investors, industries, and everyday consumers.

Let’s start with the tariffs themselves. The announcement of a 25 per cent levy on imported autos and car parts is a bold move, one that harkens back to Trump’s earlier trade policies during his first term. The stated goal, presumably, is to bolster domestic manufacturing and protect American jobs—a narrative that resonates with his political base. However, the immediate market reaction suggests that investors are less convinced of its efficacy.

Major US indices retreated, with the S&P 500 dropping 1.1 per cent, the Dow Jones slipping 0.3 per cent, and the Nasdaq taking a steeper 2.0 per cent hit. The technology sector, already reeling from negative news in AI and data centre developments, bore the brunt of this decline. The VIX, often dubbed the “fear gauge,” spiked 7.1 per cent to 18.36, signalling heightened volatility and unease among traders. This isn’t surprising—tariffs introduce uncertainty, and markets despise uncertainty.

The impact on the auto industry is particularly stark. Countries like Japan, Germany, South Korea, Mexico, and Canada, which collectively account for a significant share of US auto imports, now face a steep cost increase. For example, Japan’s Toyota and Germany’s Volkswagen rely heavily on the US market, and a 25 per cent tariff could force them to either absorb the cost (cutting into profit margins) or pass it on to consumers (raising prices).

Domestic producers like General Motors and Ford aren’t immune either, as the tariff extends to car parts—many of which are sourced globally. This could disrupt supply chains and elevate production costs, potentially offsetting any competitive advantage the tariffs aim to create.

I see this as a double-edged sword: while it might encourage some manufacturers to relocate production to the US, the short-term pain of higher costs and disrupted logistics could outweigh those gains, especially in an industry already grappling with inflation and semiconductor shortages.

Turning to the bond market, US Treasuries yields climbed across the curve, with the 2-year yield rising 2.3 basis points to 4.017per cent and the 10-year yield advancing 3.9 basis points to 4.352 per cent. This uptick reflects a shift in investor sentiment—higher yields suggest expectations of stronger economic growth or, more likely, inflationary pressures stemming from the tariffs. The US Dollar Index, up 0.4 per cent to a three-week high, further underscores this flight to safety and confidence in the dollar amid global uncertainty.

Commodities offered a mixed picture: gold held steady, a sign that investors aren’t fully panicking yet, while Brent crude rose 1.1 per cent to US$74 per barrel, buoyed by reports of declining US inventories. In Asia, the MSCI Asia ex-Japan index edged up 0.2 per cent, with Indonesia’s Jakarta Composite surging 3.8 per cent on domestic dividend news, though early trading hinted at broader regional weakness. This divergence highlights how global risk sentiment is fracturing—some markets are finding local resilience, while others brace for a tariff-induced storm.

Now, let’s pivot to the cryptocurrency angle, which adds another layer of intrigue. On the same day as the tariff announcement, Congress struck down an IRS regulation that would have required decentralised digital asset platforms to report customer transactions starting in 2027. This move, which saves the crypto industry an estimated US$4 billion in taxes, is a significant win for the sector—and, notably, for President Trump’s own World Liberty Financial platform.

Decentralised exchanges like Uniswap had argued that the rule was impractical, given their lack of custody over user assets or access to personal data. I find this development fascinating because it juxtaposes Trump’s protectionist trade stance with a deregulatory push in the crypto space, potentially benefiting his personal financial interests. It’s a reminder that policy decisions often carry a personal dimension, and here, the optics are hard to ignore.

Meanwhile, GameStop’s pivot to Bitcoin adds a wild card to the mix. The retailer’s plan to sell US$1.3 billion in zero-coupon convertible bonds to fund Bitcoin purchases—following the playbook of Michael Saylor’s MicroStrategy—sent its stock soaring 12 per cent on March 26. This isn’t just a quirky corporate move; it reflects a growing trend of companies embracing cryptocurrency as a treasury reserve asset.

With Bitcoin’s price historically sensitive to macroeconomic shifts, the tariff-induced uncertainty could either amplify its appeal as a hedge or expose it to sharper volatility. Ethereum, too, is in the spotlight with its Pectra upgrade successfully launching on the Hoodi testnet, though its price dipped three per cent amid a bearish technical pattern. If Pectra hits the mainnet by April 25, as developers hope, it could bolster Ethereum’s long-term utility—yet the immediate market mood remains cautious.

The stablecoin front offers a counterpoint of stability. Custodia Bank and Vantage Bank’s launch of a US bank-backed stablecoin on Ethereum marks a milestone in bridging traditional finance and blockchain. This isn’t just a technical achievement; it’s a regulatory breakthrough, showing that US banks can tokenise assets within legal bounds.

Caitlin Long of Custodia has long championed this integration, and her optimism seems warranted—stablecoins could smooth out some of the volatility plaguing other cryptocurrencies, especially as tariff-related turbulence looms.

My take on this is that the tariffs are a gamble—potentially revitalising US manufacturing but risking higher costs, strained trade relations, and inflation that could squeeze consumers already stretched thin. The market’s initial retreat and the VIX’s jump suggest that investors share my skepticism about the short-term outlook, though the dollar’s strength hints at underlying resilience in the US economy.

In the crypto realm, deregulation and corporate adoption (GameStop, Trump’s platform) signal a maturing industry, yet one still tethered to broader risk sentiment. The stablecoin breakthrough offers a glimmer of hope for stability, but Ethereum’s wobble reminds us that volatility remains a constant.

I can’t help but think about the people behind these numbers—the autoworkers hoping for job security, the investors watching their portfolios, the crypto enthusiasts betting on a decentralised future. The tariffs might protect some livelihoods but raise car prices for millions. The crypto wins might empower innovation but also widen inequality if gains concentrate among the well-connected.

My role here is not to pick winners or losers. What’s clear is that we’re in for a bumpy ride—April 2, when the tariffs kick in, will be just the beginning. For now, I’ll keep watching the data, the markets, and the human stories, because that’s where the real truth lies.

 

Source: https://e27.co/us-tariffs-vs-crypto-wins-an-economic-shift-20250327/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

Trump Vs. Harris: Crypto Experts Give Final U.S. Election Analysis

Trump Vs. Harris: Crypto Experts Give Final U.S. Election Analysis

In the build-up to the 2024 U.S. presidential elections, Bitcoin (BTC) flirted with all-time highs regarding the possibility that pro-crypto candidate Donald Trump would take the helm at the White House.

While polls are set to close on November 5, it could take days or even weeks for a winner to be declared, depending on how close the contest is.

If you are wondering whether now is a good time to buy Bitcoin, we have compiled all the information you need to know about the 2024 U.S. presidential election race.

Key Takeaways

  • The crypto markets nervously await the 2024 U.S. election outcome between Trump and Harris.
  • Polymarket favors Trump as the pro-crypto candidate, contrasting with traditional poll projections.
  • A Harris win may present a Bitcoin buying opportunity, while Trump could boost crypto optimism.
  • Key crypto experts share insights with Techopedia on the potential shift in the regulatory environment post-election.

The Tight 2024 U.S. Presidential Election Race

According to a poll by the New York Times (NYT) and Siena College, the 2024 U.S. presidential election race is the closest it has been in decades.

While odds on the crypto prediction market Polymarket showed Trump as a clear favorite to win the 2024 U.S. presidential election, with Trump at a 61% chance compared to Kamala Harris’ 39%, traditional pollsters and media houses expect a tighter contest.

Ahead of the November 5 voting deadline, NYT’s polls highlighted seven battleground states – Arizona, Georgia, Michigan, Nevada, North Carolina, Pennsylvania, and Wisconsin – that could decide the fate of the election.

As of November 5, Polymarket polls showed Trump had a 60% chance of winning in Pennsylvania. However, NYT and Siena College’s final set of polls said both Trump and Harris had a 48% chance each of winning in Pennsylvania.

In 2020, current U.S. president Joe Biden won the Pennsylvania state with a narrow 1.17% margin over Trump. The 2016 U.S. presidential election saw Trump win in Pennsylvania by a slender margin.

What Happens to Crypto Post-Election? Expert Analysis

Techopedia reached out to industry experts for exclusive insights on the impact of the U.S. presidential election on the crypto market.

Anndy Lian: Republican Majority in Congress is Key for Crypto Industry

Techopedia reached out to Anndy Lian, intergovernmental blockchain advisor and author of Blockchain Revolution 2030, for his thoughts on the U.S. presidential election race.

Firstly, Lian highlighted how crucial it was for the Trump-led Republican party to secure a majority in both houses of the U.S. Congress.

“For Republicans to effectively push through pro-crypto legislation, they really need to secure a majority in both houses. Without that majority, even a pro-crypto president might struggle to get meaningful bills passed.”

“So, while a Trump victory could spark optimism in the crypto space, the real key to unlocking potential growth lies in having a Republican majority in Congress.

“This combination could pave the way for policies that truly benefit the crypto market and help it thrive in the long run,” he added.

Next, we asked Lian what was in store for the crypto industry if Harris-led Democrats were to win the 2024 U.S. presidential election.

“Harris has talked about supporting technological advancements, including digital assets, but there’s a concern that her policies might not stray far from the regulatory frameworks already in place.

“This could lead to an environment that focuses heavily on consumer protection and oversight, which might limit the more hands-off approach that many crypto advocates prefer.

“In the end, while a Democratic administration under Harris may not be as favorable for crypto as a Republican one, it doesn’t mean the industry is doomed.

The real question will be how her administration chooses to navigate the fast-changing world of cryptocurrencies.”

Finally, we asked Lian what he thought of the common notion that crypto regulations will change for the better no matter who wins the U.S. presidential elections.

“The idea that crypto regulations will improve regardless of who wins the presidency is an interesting one, but I think it oversimplifies a complex issue,” said Lian.

“The regulatory environment is influenced not just by the presidency but also by Congress, state governments, and international regulations.

“Even if there’s a general trend toward better regulations, the specifics will depend on the political climate and the priorities of those in power.”

10x Research: Harris Win Will Be Buying Opportunity

In a research note to Techopedia, 10x Research said the election outcome could hinge on “just one or two critical swing states”.

The Singapore-based crypto research firm noted that Bitcoin prices could slump 9% if Harris wins, while a Trump win could result in a 5% increase in Bitcoin prices.

10x Research added that a Harris win could present Bitcoin investors with a “buying opportunity.”

“The primary driver of this bull market, dating back to at least June 2023, has been the institutional adoption of Bitcoin, sparked by BlackRock’s application for a Bitcoin Spot ETF…

“Even if Harris were to ‘remain’ U.S. President, the impact on Bitcoin would likely be minimal,” said 10x Research.

However, 10x Research noted that this “buying opportunity” is not applicable to other cryptocurrencies, especially Solana (SOL), as a Harris win would lower the chances of a Solana ETF being approved.

“Crypto (Bitcoin, Ethereum, Solana) could be up +5% if Trump wins, Bitcoin might be down -9% if Harris wins, and Solana -15%. Hence, a long Bitcoin vs. short Solana could be a reasonable election trade,” said 10x Research.

The Bottom Line

The run-up to the 2024 U.S. presidential election has been incredibly interesting to observe as a crypto enthusiast.

Be it the newfound political importance of the crypto industry or the divergence between traditional polls and crypto platform polls, one thing is for certain: we will remember 2024 as the year crypto came of age.

As we conclude this article, we would like to remind readers that cryptocurrencies are volatile assets. Always do your own research before investing. The information in this guide does not constitute investment advice and is meant for informational purposes only.

 

 

 

Source: https://www.techopedia.com/trump-vs-harris-crypto-experts-final-election-analysis

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j