BitMart Research Weekly Insights: Comprehensive Market Analysis Amidst Middle East Tensions and Stagflation Expectations

I. Macro Level

1. Geopolitics and Middle East Conflict

Negotiations between Trump and Iran have seen repeated progress and setbacks, with a significant gap remaining between their respective demands. It is highly likely that the situation in the Middle East will maintain a state of “fighting while talking” over the next 2 to 4 weeks. From a political motivation perspective, Trump intends to de-escalate the conflict in the first half of the year to avoid facing the dual pressures of high oil prices and a strained stock market as the election cycle enters its second half.

2. Federal Reserve Monetary Policy and FOMC Meeting (Hawkish Bias)

Recently, major central banks including the Federal Reserve, the Bank of England, and the Bank of Japan have generally adopted a more hawkish stance. The market has even begun pricing in the possibility of “no rate cuts” or even “additional rate hikes” by the Fed this year. The latest FOMC meeting had an overall hawkish tone: the dot plot showed an increase in the number of members supporting only one rate cut this year. Simultaneously, the Fed raised its inflation projections, and Powell downplayed signals of a weakening labor market. Furthermore, the previously dovish official Waller shifted to supporting a pause on rate cuts, further reinforcing market expectations of a hawkish stance.

3. Diverging Views on Stagflation and Recession Risks

Risk Underestimation Camp: Some argue that the authenticity of the current non-farm payroll data is questionable, and inflation has been above the 2% target for several consecutive years. If a significant external shock occurs, the U.S. economy could easily slide into stagflation or even recession, and the market has not yet adequately priced in this risk.

Opposing View: Others believe that the U.S. is now a net energy exporter, with far less dependence on oil imports compared to the 1970s-80s. Therefore, high oil prices alone are insufficient to drag the U.S. into a typical stagflation scenario. Deeper stagflation risks may instead stem from long-term fiscal expansion and the erosion of the Federal Reserve’s independence. However, if key Middle Eastern straits are blockaded for an extended period while the Fed maintains a hawkish stance, or even hikes rates again, to curb inflation, the market’s dominant trading narrative could shift from “stagflation trade” to “recession trade.”

4. Traditional Financial Asset Performance and Trading Strategies

Gold’s Sharp Decline: Gold has not recently demonstrated clear safe-haven attributes; instead, it has seen a significant drop against the backdrop of rising expectations for central bank tightening and liquidity pressures.

Hedging Suggestions: In the face of short-term uncertainty, it is advisable to hold risk assets while appropriately allocating positions related to the VIX (Fear Index), as well as fertilizer and natural gas stocks that benefit from the logic of gas shortages, as defensive hedging tools. If the market can navigate the volatility over the next 1 to 3 months, risk assets may still present good performance opportunities in the second half of the year.

II. Cryptocurrency Level

1. Chợ Trends and Sentiment

Against the backdrop of heightened macro volatility, Bitcoin (BTC) has shown greater resilience compared to gold, generally maintaining relative stability around $70,000. Recently, BTC retreated again after rebounding from $76,000 and entered a consolidation phase. Current trading volumes in both spot and futures markets are relatively low, while the options market is more active. The rising skew and prices of put options reflect an increase in market risk-aversion and panic sentiment.

2. Institutional Moves and ETFs

Institutional capital allocation is showing divergence. MicroStrategy’s Bitcoin buying intensity has cooled significantly, dropping from weekly additions of 10,000-20,000 BTC in the past to around 1,000 BTC. However, other institutions have continued large-scale purchases of Ethereum, with weekly buying volumes around 60,000 ETH. Overall, Bitcoin spot ETFs are still maintaining slight net inflows.

3. On-Chain Data and Bottoming Analysis

From on-chain data, the profit level of long-term holders has fallen back to the consolidation range (green zone) corresponding to the bottom of the previous bull-bear cycle. This suggests that the most intense phase of the decline may be over, and the market is in a gradual bottoming process. Meanwhile, short-term holders exhibited significant profit-taking behavior around $76,000, creating periodic selling pressure.

4. Regulatory Tailwind (Clarity Act)

On the regulatory front, resistance to further consensus on the mật mãcurrency regulatory Clarity Act in the Senate has decreased. The market now assesses its probability of passage has increased to 80%-90%. Simultaneously, the banking system may gradually relax restrictions, allowing users to indirectly participate in yield-bearing products related to stablecoins. This is seen as a clear policy tailwind, potentially opening channels for larger-scale traditional capital to enter the crypto market.

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