Market Snapshot: Mild Rebound Amid Lingering Concerns

The U.S. markets opened the week with modest gains. On Monday (April 14), all three major indexes edged up slightly. Futures, however, reversed course with a mild decline, indicating continued investor caution. Gold surged to $3,228 per ounce, and crude oil hovered around $61.80 per barrel.

Bitcoin rallied to the $84,000 level, supported by a broader uptick in large-cap altcoins. Total crypto market capitalization stood at $2.76 trillion. U.S. Bitcoin spot ETFs saw a minor net inflow of $1.5 million, while Ethereum spot ETFs recorded $6 million in outflows.

Some analysts highlighted the recent correlation between gold and Bitcoin, noting that BTC price historically lags behind gold by approximately 100–150 days. With gold reaching new highs, expectations are building for a potential BTC rally over the next few months. Presently, 80% of BTC in circulation is held in profit.

Extreme Bearish Sentiment Among Investors

Despite temporary rallies, investor sentiment remains deeply bearish. According to AAII data cited by @KobeissiLetter, 58.9% of retail investors expect markets to decline over the next six months. This pessimism nears levels seen during the 2022 bear market and the 2008 financial crisis. The percentage of bearish investors has stayed above 55% for seven consecutive weeks, matching a record set in 1990. Historically, such sentiment often precedes unexpected market reversals.

Fed Balances Tariff-Driven Inflation Risk and Growth Slowdown

Fed Governor Christopher Waller acknowledged that Trump's proposed tariffs might cause inflation to spike temporarily. Drawing parallels with the 2021–2022 inflation episode, Waller defended the Fed’s cautious approach. In scenarios with high, prolonged tariffs, inflation could reach 4–5% before cooling as growth slows and unemployment rises. If tariffs are moderate, inflation might tick up to 3% before tapering off.

In both scenarios, Waller emphasized that rate cuts are still on the table. Larger tariffs could trigger earlier cuts to cushion economic drag, while a milder path might delay action until late 2025. The Fed appears prepared to accommodate evolving conditions even as political pressure mounts.

Trump Looks to Replace Fed Chair Jerome Powell

Treasury Secretary Scott Bessent revealed that President Trump intends to begin interviews this fall for a new Fed Chair to replace Jerome Powell, whose term ends in May 2026. Although Trump initially appointed Powell during his first term, his frustration with Powell’s reluctance to aggressively cut rates has grown.

While the President cannot remove a Fed Chair mid-term, he retains the right to appoint a successor upon expiration. Trump reportedly wants a Fed leader who aligns more closely with his policy vision—especially around interest rates and bond market stabilization. If Powell had cooperated by easing rates or purchasing Treasuries, Trump might not have needed to deploy the recent 90-day tariff suspension. A more dovish Fed could significantly aid Trump’s economic strategy in a second term.

No New Exemptions on Tariffs, Clarifies the White House

Rumors circulated that Trump had issued new tariff exemptions on tech products like semiconductors and solar panels. The White House refuted these claims, clarifying that such products were already exempt under Executive Order 14257 signed on April 2. No new exceptions have been issued. Media outlets spreading contrary information are accused of misrepresenting facts to undermine trade negotiations.

Commerce Secretary Howard Lutnick confirmed that new classifications for key tech items—such as smartphones and computing devices—would be announced within a month. This provides time for firms like Apple and Microsoft to prepare for changes. Lutnick expressed confidence that a new U.S.–China trade agreement is achievable.

Over 130 Countries Now in Trade Talks With the U.S.

According to National Economic Council Director Kevin Hassett, more than 130 countries have approached the U.S. with negotiation proposals. Japan, India, and South Korea have reportedly submitted attractive offers. Talks with China remain stagnant. The U.S. now navigates two parallel negotiation tracks: one with China, and one with the rest of the world.

Europe and China React to Trump’s Trade Strategy

The EU is considering a proposal to bulk-purchase natural gas from the U.S. in hopes of smoothing over trade imbalances. This strategy, once dismissed by Trump, is being revised to appeal to his negotiation style. Simultaneously, Europe resumes LNG talks and prepares for broader trade discussions, seeking to balance cross-Atlantic commerce.

China, on the other hand, has urged the U.S. to “fully revoke” the retaliatory tariffs introduced by the Trump administration. The Chinese Ministry of Commerce called for mutual respect and a return to equitable trade practices. However, USTR Jamieson Greer stated there are currently no plans for President Trump to speak with President Xi Jinping. Tariff-driven losses are beginning to bite deeper into both economies, with real business impacts surpassing financial market volatility.

Other Highlights and Policy Developments

U.S. Treasury Secretary noted a spike in the VIX, suggesting volatility may have peaked and markets could stabilize soon. Meanwhile, corporations reportedly acquired over 95,000 BTC in Q1 2025—setting a record. Grayscale’s ETH ETF staking approval has been delayed by the SEC.

Elsewhere, HK Asia Holdings purchased 10 BTC worth approximately $806,671. In a landmark tax case, U.S. trader Waylon Wilcox faces charges after underreporting income from 97 CryptoPunk sales, evading $3.2 million in taxes.

MicroStrategy added 3,459 BTC to its reserves, raising its holdings to 531,644 BTC valued at over $35.9 billion. Senator Tim Scott confirmed that bipartisan crypto legislation—including stablecoin regulation—is expected by August 2025.

Notably, Google will tighten advertising requirements for crypto exchanges and wallets in Europe starting April 23. Advertisers must comply with MiCA or CASP frameworks and obtain certification.

Finally, newly confirmed SEC Chairman Paul Atkins vowed to prioritize regulatory clarity for digital assets, pledging to work with Congress to establish a clear legal framework and reassert America’s role as the global hub for crypto innovation.

Disclaimer

This content is for informational purposes only and should not be considered financial or investment advice. Always conduct your own research before making investment decisions.

Sources: U.S. Federal Reserve, SEC.gov, Treasury Department, Bloomberg, WSJ, Reuters, CNBC, TradingView, CoinDesk.

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