1. Market observation

Keywords: ARBUS, ETH, BTC

Following S&P and Fitch, Moody's downgraded the US credit rating from Aaa to Aa1. The main concern stems from the continued expansion of the fiscal deficit - the federal deficit as a percentage of GDP is expected to rise from 6.4% in 2024 to nearly 9% in 2035. The rising debt interest, increased welfare spending and insufficient tax revenue have formed a triple squeeze. The political deadlock has exacerbated the fiscal dilemma. The House Budget Committee failed to pass Trump's tax reform plan with a cost of $3.8 trillion, and the draft budget shows that most of the increase in the deficit over the next decade will come from the extension of the Tax Cuts and Jobs Act. The upward pressure on bond yields is in conflict with the Bloomberg Dollar Index approaching its April low. While market confidence in the dollar has weakened, Morgan Stanley predicts that US inflation will accelerate to 3.0-3.5% for the whole year in May, forcing the Federal Reserve to keep interest rates unchanged in 2025. Atlanta Fed Chairman Bostic expects only one rate cut this year, and economic growth may slow to the range of 0.5-1%, forming a complex pattern of low growth and high inflation.

Bitcoin broke through $107,000 this morning, and it only needs to rise 2.42% to reach its all-time high of $109,800. Many crypto traders expect Bitcoin to hit a new all-time high. Analyst Alan predicts that Bitcoin will break its all-time high in the next few days, with a target price of $116,000. American billionaire investor Tim Draper continues to increase his holdings of Bitcoin, and Robert Kiyosaki, author of "Rich Dad Poor Dad", expects Bitcoin to rise to $250,000 this year. Crypto analyst Scott Melker also believes that with the participation of traditional financial institutions such as pension funds and ETF issuers, the Bitcoin market is becoming more mature and stable, and its volatility has dropped from three times the S&P 500 index in the past to less than two times, so it is not impossible for the current price of Bitcoin to rise another 2.5 times to $250,000. As for Ethereum, its price once fell back to below $2,400 after breaking through $2,700, and more than $200 million in long orders were liquidated in the past 24 hours. However, market technical analysis shows that Ethereum prices are still in a bullish flag pattern, and if it breaks through the current resistance level, the target price may point to $3,700. Analyst Titan of Crypto pointed out that the weekly stochastic relative strength index shows that Ethereum still has the potential to rise. Analyst Chimp of the North believes that Ethereum may rise again to the $3,000 to $3,300 range after a pullback to $2,400, while Crypto Patel said that if the price falls to $1,800 and gets support, it may start a new round of rising market with a target price between $4,000 and $5,000.

In the secondary market, altcoins unexpectedly did not fall with the fall of Ethereum, and the market is still keen on trading several major Meme coins such as MOODENG, NEIRO, and PNUT. The latest new project ARBUS on the Virtuals platform earned about 50 times the profit over the weekend, and its current market value is about 11 million US dollars. At the same time, LAUNCH, a currency with the same concept as LAUNCHCOIN on the Believe platform, appeared on Pump.fun, with a current market value of about 3 million US dollars. In the past 24 hours, the Meme coin Time has aroused speculation due to Elon Musk's tweet "Time is the ultimate currency". It is regarded by some communities as a tool to satirize the traditional value system. Its market value is currently 2.2 million US dollars, and the trading volume in the past 24 hours is nearly 20 million US dollars. In addition, after Twitter issued coins, the Telegram platform also issued coins, among which OMNI currently has a market value of 1.3 million US dollars.

2. Key data (as of 12:00 HKT on May 19)

(Data sources: Coinglass, Upbit, Coingecko, SoSoValue, Tomars, GMGN)

• Bitcoin: $103,600 (+12.2% YTD), daily spot volume $34.68 billion

• Ethereum: $2,453 (-22.9% YTD), with daily spot volume of $25.93 billion

• Fear of Greed Index: 74 (greed)

• Average GAS: BTC: 1.07 sat/vB ETH: 0.95 Gwei

• Market share: BTC 63%, ETH 8.8%

• Upbit 24-hour trading volume ranking: BTC, XRP, ETH, DOGE, NXPC

• 24-hour BTC long-short ratio: 1.15

• Sector gains and losses: Meme coin (PEPE, BONK fell more than 10%), SocialFi (-4.2%)

• 24-hour liquidation data: A total of 150,151 people were liquidated worldwide, with a total liquidation amount of US$645 million, including BTC liquidation of US$158 million, ETH liquidation of US$245 million, and SOL liquidation of US$19.1454 million

• BTC medium and long-term trend channel: upper channel line ($103016.97), lower channel line ($100977.03)

• ETH medium and long-term trend channel: upper channel line ($2389.95), lower channel line ($2342.62)

*Note: When the price is higher than the upper and lower edges, it is a medium- to long-term bullish trend; otherwise, it is a bearish trend. When the price passes through the cost range repeatedly within the range or in the short term, it is a bottoming or topping state.

3. ETF flows (as of May 16)

• Bitcoin ETF: +$260 million

• Ethereum ETF: +$22 million

4. Today’s Outlook

• Sahara AI announces the launch of SIWA public testnet on May 19

• The difficulty of Bitcoin mining has been adjusted at block height 897120 (22:01:56 Beijing time today), and the difficulty of mining has been increased by 2.13% to 121.66T;

• Pyth Network (PYTH) will unlock 2.13 billion tokens at 22:00 on May 19, worth approximately $325 million, accounting for 58.62% of the circulation.

• Eigenlayer (EIGEN) will unlock 1.29 million tokens at 3:00 on May 20, worth approximately $1.84 million, accounting for 0.43% of the circulation

The biggest increases in the top 500 stocks by market value today: BUILDon (B) up 41.44%, PRO up 29.41%, KTA up 20.64%, ACT up 20.13%, and STMX up 16.98%.

5. Hot News

• Macro Outlook of the Week: The U.S. bids farewell to the top credit rating club, and the U.S. stock market rebound may end

• This week's preview | US lawmakers will hold a final vote on the stablecoin GENIUS Act; Trump plans to attend the TRUMP dinner on May 22

• Data: PYTH, ZKJ, PIXEL and other tokens will usher in large-scale unlocking, of which PYTH unlocking value is about 338 million US dollars

• Metaplanet purchased another 1,004 BTC, bringing its total holdings to 7,800

• Raydium LaunchLab created more than 119,000 tokens, with a graduation rate of only 0.21%

• Hyperliquid traders who earned over $15 million are shorting ETH, BTC and other mainstream currencies

• Blum co-founder Vladimir Smerkis arrested in Moscow on suspicion of massive fraud

• Trader James Wynn: If Bitcoin falls back below $100,000, I will increase my position, but it is unlikely

• Rich Dad Poor Dad author predicts Bitcoin will rise to $250,000 this year

• Solana Q1 app revenue totals $1.2 billion, best quarter in a year, with Pump.fun leading with $257 million

• Bitcoin mining difficulty rose 2.13% to 121.66 T at block height 897,120

• The price of 1 Bitcoin is almost equivalent to 1 kilogram of gold

• SEC to review executive pay disclosure rules