An unexpected political twist is shaking the macro landscape. U.S. Congresswoman Anna Paulina Luna claims Fed Chair Jerome Powell’s firing is imminent, shortly after Donald Trump criticized the Fed’s controversial $2.2B building renovation. As of Monday, traders still priced an 80% chance of Powell finishing his term, but this scenario now feels far less certain.

A change in Fed leadership would introduce new uncertainty around interest rate policy and could rattle markets. For crypto, this may fuel volatility, if central bank credibility comes into question.

Meanwhile, BTC has pulled back from its highs, but altcoin dominance and strength vs. BTC is rising. Could this be the early stages of a longer trend?

Here’s what we’ll cover today:

Let’s dive in!

Bitcoin ETFs recorded $2.7 billion in net inflows last week, marking one of their strongest weeks since launch. The sharp rise, shown clearly at the end of the chart, highlights renewed institutional demand. Consistent inflows throughout 2024 and 2025 reinforce the view that Bitcoin is becoming a strategic allocation in many portfolios.

In a political twist, U.S. Congresswoman Anna Paulina Luna claimed Federal Reserve Chair Jerome Powell’s firing is imminent. This came shortly after former President Donald Trump implied that Powell’s role could be in jeopardy, specifically referencing controversial and expensive renovations at the Federal Reserve building. While largely dismissed by markets until now, this is a scenario that remains entirely unpriced.

In our Monday report, we highlighted that traders currently assign an 80% probability to Powell completing his term.

A disrupted Fed could trigger uncertainty around monetary policy, potentially giving risk assets like Bitcoin a short-term lift, though this isn’t a long-term bullish catalyst. More likely, the immediate effect would be sharp market gyrations, possibly offering both opportunity and risk to crypto traders.

On the macro side, June CPI data delivered a more nuanced inflation picture. Core CPI rose by 0.2% month-over-month, while the annual rate edged up to 2.9%, compared to 2.8% in May. Headline CPI accelerated to 2.7% year-over-year, up from 2.4% the previous month. The chart indicates inflation has been gradually increasing in early 2025, rather than continuing the previous downward trend.

This inflation surprise triggered volatility in rate cut expectations. Traders initially priced in minimal policy easing for September, later shifted toward a full 25bps cut in mid-June, and have since adjusted back to roughly 20bps of easing priced in. These rapid changes underline the market’s ongoing sensitivity to inflation data and macro signals.

Meanwhile, consumer inflation expectations have normalized. One-year and three-year outlooks are both anchored around 3%, similar to pre-pandemic levels. This suggests the elevated inflation psychology of 2021–2022 has faded, giving the Federal Reserve more flexibility to support growth without the fear of de-anchoring expectations. Well-anchored expectations also support risk assets, including crypto, by reducing macroeconomic uncertainty.

Now let’s dive into the part you’re really here for: the charts, key levels, trade scenarios and what’s next for Bitcoin and Altcoins. 🔥 

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