BTC hits $107k resistance: Rate cut hopes build

Markets are holding their breath for Wednesday's inflation data as BTC stalls at major resistance and altcoins struggle to find momentum. With US-China trade talks resuming in London and ETF flows slowing, the crypto landscape is shifting beneath our feet. The question isn't whether volatility is coming—it's which catalyst will trigger the next major move.

TLDR

• Jobs data mixed: Strong headline at 139k, but trend shows slowing with revisions down 95k; rate cuts likely post-summer • CPI ahead: Inflation print Wednesday with 2.5% expected; ≤2.5% could boost markets significantly • US-China talks: Trade negotiations resume in London, focusing on semiconductors; potential market lift expected • Crypto stalls: BTC at $107k resistance with ETF flows slowing; alts remain weak below key levels

Topics covered

• Labour data and this week's economic releases • Trade negotiations between the US and China in London • ETF flows, BTC analysis and crypto indexes • Cryptonary's strategic take and positioning

Disclaimer: This is not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results.

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Labour data and this week's data

We ended last week with the release of new labour market data, in which the number of jobs added came in at 139k and the unemployment rate remained at 4.2%. On the surface, this was a strong report, or at least much stronger than expectations were going into it. This "stronger" report saw risk assets move up slightly, but the stand-out move was in bond yields, which rallied aggressively. The reason being that a stronger labour market means less chance of a recession, and therefore investors don't need the safety of bonds, and hence they sell off, and yields move higher.

However, the labour market is decelerating, and zoomed out, we're in a longer-term downtrend. For instance, the last two months' jobs reports have been revised lower by 95k jobs (95k jobs less than what was reported at the time), and so far in 2025, the US is averaging 124k jobs added per month, compared to 168k jobs in 2024. If the labour market does deteriorate in a more meaningful way, then that's what would give the FED their "green light" to restart cutting interest rates again—although we're not expecting interest rate cuts to begin until after the summer at the earliest.

What's next

BTC is sitting at critical resistance, while alt indexes remain trapped below key breakout levels. Trade talks could spark short-term optimism, but the real question is whether Wednesday's CPI print will finally give crypto the macro tailwind it needs. Will 2.5% inflation be the catalyst that breaks this stalemate?

This week's data

The key data release that the market will be watching this week is Wednesday's inflation report. The expectation is that the numbers are going to come in slightly higher than last month's reading, with the headline expected to come in at 2.5% (above last month's 2.3%). 2.5% or below, and the market will likely still react positively, as headline inflation is downtrending.

Headline Inflation YoY:

There is an argument that inflation might be bottoming as the price of oil potentially bottoms and the labour market supply decreases due to less immigration into the US, so this is something we're watching as well. But it is possible that this argument is just generally offset by a slowing economy. We're watching both sides and the data as it develops.

Trade negotiations between China and the US in London

Trade negotiations between senior officials of the US and China began in the UK today. Both sides are likely to discuss chips (semiconductors) and rare earths. It is expected that both sides are looking to come to an agreement, and therefore, it's likely we'll see positive social media posts out of the Trump administration, and this could make markets move slightly higher.

The left tail event is that there is a big disagreement and a breakdown in talks again, although this isn't something we're expecting, as it would be extremely surprising for negotiations to be back on so quickly after they initially broke down/stalled in Geneva last month.

ETF flows, BTC and the indexes

In the last two weeks, BTC's ETF flows have been more mixed. We saw substantial outflows in the last few trading days of May, with last week's action being choppy/mixed at best, especially if we compare this against the strong inflows we saw in late April and throughout May.

BTC ETF Flows (in USD value):

The above suggests that the demand for the BTC ETF is slowing with price in the $107k's.

Chart-wise, BTC is at a key level here. It has bounced from the $101k level, and the price has moved into the major horizontal resistance at $107k, which also converges with the top border of the broadening wedge pattern. If BTC were to reject here and pull back, we'd be buyers in the yellow box, between $95,700 and $98,900.

BTC 1D timeframe:

Let's now turn to the indexes: BTC.D and TOTAL3.

BTC has moved higher, and whilst this usually provides a good environment for alts/memes, BTC dominance has continued its local uptrend higher, with it now being just 0.5% away from its local highs. Alts/memes should hold up in this environment, but the "alt seasons" of the past have come when dominance has broken down, and right now, we're just not seeing that.

BTC.D 1D timeframe:

Alongside the above, TOTAL3 (the total crypto market cap minus BTC and ETH's market caps) remains below its main uptrend line, whilst it's still below the major horizontal level (currently a resistance) of $879b. Price is, however, trying to break out of a local downtrend line. Ideally, we want to see this move hold and for the price to push onto the horizontal resistance of $879b, and then break out. But for now, there are no convincing signs of this yet.

TOTAL3 1D timeframe:

Cryptonary's take

Bitcoin continues to look strong and be bid, with this probably being due to the Trump administration being so positive on crypto. However, we have recently seen ETF inflows slow as BTC has moved higher into its resistance. But, outside of BTC, we're not seeing a ton of strength elsewhere as BTC dominance continues to grind higher, with altcoin indexes remaining below their key levels and lacking any clear signs of strength.

If we then pair the above alongside the macro, the likelihood is that we're set up for a choppy summer as the FED likely remains on pause as it awaits the follow-through data off the back of the tariff fallout. However, there are signs of some slowing in the economic and labour market data, although it is still holding up. If we see a more material weakening, then that would result in the FED cutting interest rates sooner than expected—the current estimates are for the first cut to come in October.

Risk appetite remains muted in part due to ongoing policy uncertainty, which continues to weigh on tech and high beta sentiment.

For now, we remain on hold, and we're sitting in USD. We will look to pick up majors on substantial pullbacks or upon a breakout in the indexes. An example of this would be TOTAL3 breaking out of $879b. For now, we prefer to wait on confirmations of breakouts, considering the macro is still as uncertain as it is.