This week delivered a masterclass in crypto market dynamics, with Bitcoin's pullback from all-time highs coinciding with remarkable relative strength from Ethereum. As Fed rate cut expectations fade and institutional money flows in new directions, we're witnessing what could be the early stages of a significant capital rotation.

Here's our complete breakdown of the forces reshaping the market landscape.

Here's what we'll cover today:

Let's dive in!

Bitcoin saw a notable decline over the past 48 hours, dropping from around $120,000 to ~$115,000 as expectations for Fed rate cuts began to fade. The sell-off accelerated during Thursday’s Asian session, with BTC shedding over 3% as markets recalibrated their policy outlook. This correction appears technical rather than fundamental, a natural pullback after Bitcoin’s strong run to new all-time highs. The price action reflects classic profit-taking near psychological resistance, which we view as a healthy part of any bull market cycle.

Importantly, Ethereum showed relative strength, holding steady while Bitcoin, Solana, and other altcoins faced heavier selling pressure, a dynamic we’ll explore in more detail in today’s newsletter.

Meanwhile, the U.S. dollar continues to retreat against major global currencies, reinforcing our long-held bearish dollar thesis that has served our readers well throughout 2025. Every major currency pair is up year-to-date against the greenback. This broad weakness reflects shifting global monetary dynamics and reduced demand for USD as a safe haven amid a more dovish Fed outlook.

Perhaps most notably, S&P 500 implied volatility has collapsed to near its lowest levels of the year, signaling unusual market complacency despite ongoing macro uncertainties. The VIX’s subdued readings suggest investors are increasingly comfortable with current conditions, a stark contrast to earlier volatility in 2025. This type of low-volatility regime often precedes either continued upside in risk assets or sharp volatility spikes once complacency peaks. While these environments can persist, they often set the stage for outsized moves.

For now, the backdrop supports our risk-on stance across crypto and growth assets, but we remain alert to any signs of complacency unwinding.

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

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