The optimism released by the call between the leaders of the United States and China overshadowed the impact of weak economic data, pushing the US dollar (USD) and US Treasury yields back up, while gold and Bitcoin (BTC) both suffered setbacks. Gold started a long-short battle at the key level of $3,360, while Bitcoin fell 3%, hitting a new low in nearly a month since May 8, just one step away from the 100,000 mark. Ethereum also fell more than 7%, recording the largest single-day drop in two months.

The current trading logic of the market is that after the US Treasury market stabilizes, the attractiveness of alternatives to the US dollar has declined. However, although the US-China trade relations tend to ease, there has not been any substantial positive news, so it cannot be ruled out that the market will return to the recession trading logic after digesting the good news in the short term, especially when the labor market data such as ADP employment and initial jobless claims released by the United States this week performed poorly.

Investors can focus on the US non-agricultural data in May during the day. If the non-agricultural data performs poorly, it will further confirm that the economy is slowing down, which will put further downward pressure on risky assets such as Bitcoin. In the short term, although expectations of rate cuts may rise as the economy goes down, it is expected that the Fed will need to see clearer signs of labor weakness before taking action, so expectations of rate cuts will not be able to stop the decline in short-term risk appetite.

However, in the medium and long term, with the further clarification of US regulatory regulations and the development of cryptocurrency-related reserves and stablecoin policies, Bitcoin prices are expected to gain momentum in 2025. According to Alice Li, partner of cryptocurrency venture capital firm Foresight Ventures, increased US regulatory clarity could push Bitcoin above $150,000 in the current market cycle.