“Overall, this points to a stabilizing but still fragile ETF demand backdrop, with investors no longer accelerating exits but gradually repositioning capital, providing a potential floor to the downside,” the firm said.
The other dynamic of note is the decoupling of the US two-year Treasury yield, which is sensitive to the Fed’s interest rate expectations, and WTI crude oil futures. While oil prices have collapsed, the two-year yield has strengthened and is hovering at 4.21% at the time of writing, the highest since February 2025. (Check the daily signal.)
The decoupling indicates that oil and geopolitical headwinds for risk assets have been replaced by Fed rate hike expectations. It is possible that markets expect the second-order effects of the March oil price increase to keep inflation higher in the short term, increasing the likelihood of rate hikes.
The Fed’s preferred inflation gauge, core PCE, is expected to confirm the trend. According to FactSet, it is expected to have risen 0.37% on the month, lifting the 12-month yield to 3.4%, which would be the highest since May 2024.
Overall, the slower but still bleeding ETFs and hawkish hints from bond yields suggest lower odds for a convincing BTC price rally in the near term.
And there’s also what Strategy, the largest publicly traded BTC holder, is doing to address concerns about the price volatility of its STRC preferred stock. Pay attention!
