Bitcoin Hits New Record Open Interest

The leading cryptocurrency is faltering under pressure from bonds, a Moody's downgrade, and a hawkish Fed forecaster anticipating only one rate cut this year. Is a perfect storm brewing?

Bitcoin (BTC) closed the day slightly down 0.82% at $105,818, after unsuccessfully battling the $107,000 resistance. The world's leading cryptocurrency experienced strong volatility, hitting a low of $102,000 amid speculation about rising US Treasury yields and a grim outlook from the Federal Reserve, with a senior official predicting a near-total halt to rate cuts.

In technical analysis, the Bitcoin price maintains an uptrend above the 50- and 200-period exponential moving averages / TradingView

Bonds and Moody's in the Shadows: A Double Whammy

The yield on the 10-year US Treasury bond climbed to a high of 4.56%, driven by Moody's downgrade of the US credit rating. This upward pressure adds to the persistent uncertainty surrounding the trade war, creating a complex scenario that severely limits the Federal Reserve's (FED) options to ease financial conditions through interest rate cuts.

Only One Cut in 2025! Bostic's Cold Shower

Expectations for monetary easing were further dampened by forceful statements from Atlanta Federal Reserve President Raphael Bostic. The influential official predicted that the central bank could only afford a modest rate cut of a quarter of a percentage point for the remainder of the year. Bostic warned in a statement to CNBC that progress toward returning inflation to the Fed's 2% target "will take a little bit longer," leaning "much more toward a single cut this year." This outlook stands in stark contrast to March's projections, where monetary policymakers anticipated interest rate cuts of half a percentage point throughout 2025.

Red-Hot Futures: One Last Bullish Hope?

Despite the challenging macroeconomic outlook, the Bitcoin futures market posted a new all-time high in open interest, reaching $71.93 billion, surpassing the previous peak of $71.93 billion on December 18, 2024, according to CoinGlass data. This increase, coinciding with a recovery from the day's lows, suggests a significant inflow of liquidity and persistent buying pressure that could herald attempts to break through the resistance.

The Battle Continues: Bulls Versus Bears at $100,000

In technical analysis, the Bitcoin price maintains an uptrend above the 50- and 200-period exponential moving averages. The recovery from $102,000 indicates a solid defense of the psychological support at $100,000. However, resistance at $107,000 stands as a key hurdle that buyers must overcome to renew bullish momentum in an increasingly adverse macroeconomic environment.

Bitcoin's future hangs in the balance. The combination of bond pressure, credit downgrades, and an inflation-wary Federal Reserve raise serious questions about the sustainability of its uptrend. The all-time high in futures open interest offers a glimmer of hope, but caution and volatility will remain key in the crypto market.

Disclaimer: This analysis is based on information available at the time of writing and does not constitute financial advice. Cryptocurrency trading is highly risky and can result in significant losses. Please conduct your own research before making any investment decisions.