Bitcoin stabilizes above $80k: Federal Reserve leadership change imminent, structural bull market pattern begins to emerge in the crypto market

In mid-May 2026, the cryptocurrency market continues its strong trend. Since Bitcoin broke the $80k threshold on May 4, it has steadied between $80k and $82k, with a monthly increase of over 20%. If the current month closes positively, it will set a historic pattern of three consecutive months of gains in March, April, and May. Ethereum follows suit, with a monthly gain of about 15%. The core logic driving this rally is the sustained net inflow of funds into the US spot Bitcoin ETF—$1.97 billion in April alone, a new high for the year, with BlackRock’s iShares Bitcoin Trust (IBIT) accounting for $2.01 billion; combined with expectations that Federal Reserve Chair Powell will step down on May 15 and be succeeded by Kevin Warsh, known as the "crypto-friendly" candidate, the market is shifting from "defensive regulation" to "integrative innovation." This article provides an in-depth analysis from macro policy, capital flows, and technical structure perspectives, along with short- to medium-term trading strategies and risk warnings.

1. Macro Policy Shift: Fed Leadership Change and Liquidity Expectation

On May 15, Federal Reserve Chair Jerome Powell will officially step down, with Kevin Warsh taking over, marking an important turning point in US cryptocurrency policy. During Powell’s tenure, Bitcoin was always regarded as a "speculative asset," whereas Warsh is considered by industry insiders as the "most crypto-savvy" Fed chair in history. His appointment signals a shift from "defensive and preventive" to "integrative and innovative" US crypto policy.

This personnel change occurs amid significant adjustments to Fed liquidity tools. Previously, the Fed canceled the daily $500 billion limit on standing repurchase agreements (SRP), allowing banks to borrow from the Fed without limit using government bonds as collateral—significantly raising the market liquidity ceiling. If Warsh further promotes dovish monetary policy, lowering borrowing costs, it will directly benefit high-risk assets like cryptocurrencies. Investors should closely monitor market volatility around May 15. Historical experience shows that major personnel transitions often cause short-term liquidity disruptions, but the medium-term direction is likely toward easing.

2. Institutional Capital Influx: ETF Continuous Net Flows Reshape Market Structure

In April, US spot Bitcoin ETFs saw the highest monthly capital inflow since 2026, with net inflows of $1.97 billion, pushing total ETF holdings past $100.5 billion. BlackRock’s iShares Bitcoin Trust (IBIT) alone received about $2.01 billion in April, increasing assets under management to $61.9 billion, making it the preferred channel for institutional Bitcoin allocation.

This capital strength indicates ETF buying has exceeded miners’ output by several times, creating a significant supply-demand gap. On-chain data shows whale addresses have been accumulating over 270k BTC in the past month, resonating with ETF inflows, indicating institutions are shifting from "tentative allocation" to "strategic accumulation." Wang Peng, a deputy researcher at Beijing Academy of Social Sciences, notes that the fundamental market structure has changed—US spot Bitcoin ETFs are creating a fixed allocation demand, continuously pushing prices higher.

It’s also noteworthy that stablecoins are becoming the core infrastructure connecting traditional finance and the crypto ecosystem. JPMorgan’s latest report in May 2026 states that the total stablecoin market cap reached a record high of $315 billion in Q1, with quarterly trading volume hitting $28 trillion, roughly double the scale of 2025. Stablecoins have evolved from marginal tools to essential financial infrastructure for DeFi lending, cross-border payments, and institutional treasury management, indicating a fundamental transformation in underlying market liquidity.

3. Technical Structure Analysis: The Battle Between Resistance and Support Levels

Price-wise, Bitcoin surged past $80k in the early hours of May 4, reaching a high of $82,430, then entered a consolidation zone between $80k and $82k. As of May 12, Bitcoin closed at about $80,742, up roughly 5% since May began.

On the technical front, the 200-day moving average stands at $83,842, a key dynamic resistance level Bitcoin has not effectively broken since January 2026. Moneta Markets’ forex analysis indicates that the next critical target for professional traders is around $85,200. If prices rise to this level, market makers holding short gamma positions near $82,000 will likely hedge, providing upward momentum.

From a longer-term "rainbow chart" perspective, current prices remain in the "buy" zone of the mid-cycle (roughly $77,630 to $100,127), not yet entering "accumulate" or "hold" zones, suggesting the market is not overheated and long-term valuation supports further upside. Although MACD remains negative, the histogram is shrinking, indicating waning downside momentum; RSI has pulled back from neutral and shows signs of stabilization near support levels.

Ethereum trades around $2,366, with a monthly increase of 15.35% and an annual gain of 29.15%, outperforming Bitcoin. Its rally is mainly driven by ongoing ecosystem iterations and mature Layer 2 scaling solutions, leading to a revaluation of its long-term value. The $2,300–$2,500 zone for Ethereum forms a confluence of support and resistance. If Bitcoin successfully breaks $85,000, Ethereum could follow to test its previous high near $2,800.

4. Market Structure Signals: The Significance of Three Consecutive Monthly Gains

A key underestimated signal is that if Bitcoin closes above $80k in May, it will confirm three consecutive months of positive returns—March, April, and May. Moneta Markets emphasizes that such a streak has never occurred in a bear market cycle. If validated this month, it would statistically mark the start of a new bull market.

Perpetual contract funding rates have shifted from negative to neutral, with short-term selling pressure easing. Leverage levels are healthy, with no signs of the excessive speculation that caused extreme funding rates in Q4 2025. This suggests the current rally is primarily driven by spot buying rather than leveraged speculation, indicating a more solid market structure.

5. Trading Strategies and Risk Management

Short-term (1-2 weeks)

Direction: Slightly bullish with oscillations, buy on dips

Bitcoin has established psychological support at $80k. Before and after the Fed leadership change on May 15, market volatility may increase, but dips are opportunities to add positions. It’s recommended to build long positions gradually between $79,000 and $80,500, with a stop-loss at $77,500 (below April’s high and short-term uptrend). Initial targets are $85,200, with potential extension to $88,000–$90,000 if broken.

Ethereum can be accumulated on dips around $2,300–$2,400, with a stop-loss at $2,150, targeting $2,650 and $2,800.

Medium-term (1-3 months)

Direction: Strategic holding, focus on policy implementation

If May’s close remains above $80k, consider increasing Bitcoin holdings to 40–50% of total crypto assets, with Ethereum at 30–35%, and 15–20% allocated to top Layer 1 chains and DeFi blue chips. The mid-term target is $100,000, aligning with the rainbow chart "accumulate" zone and the last major resistance before the October 2025 high of $126,073.

Key variables to monitor include: Warsh’s first public speech, US crypto legislation progress, and whether spot Ethereum ETF fund inflows replicate Bitcoin ETF patterns.

Risk Warnings

First, the $83,842–$85,200 resistance zone is a confluence of multiple technical hurdles. If three attempts fail, watch for potential deep corrections, with strong support at $75,000–$78,000.

Second, the Fed leadership transition window (around May 15) may trigger short-term profit-taking ("buy the rumor, sell the fact"), increasing volatility. High leverage positions should be de-leveraged in advance.

Third, despite strong ETF inflows, a series of net outflows in late May could break the current supply-demand balance and reverse the trend. Daily tracking of SoSoValue’s ETF fund flow data is recommended for dynamic position adjustments.

6. Conclusion and Outlook

Combining macro policy shifts, continuous institutional inflows, and technical improvements, the crypto market is at a critical juncture transitioning from "bottoming out in a bear market" to "structural bull market." Bitcoin breaking and holding above $80,000 in May is not just a price milestone but a qualitative change in market confidence and capital structure.

Price forecast: In the short term (late May to early June), Bitcoin is likely to consolidate between $78,000 and $85,000 before attempting to push toward $88,000–$92,000. In the mid-term (Q3 2026), if the Fed enters a rate-cut cycle under the new chair, Bitcoin could test $100,000–$110,000. Ethereum will follow Bitcoin’s rhythm but with greater flexibility, targeting $3,000–$3,200 in the medium term.

Investors should maintain strategic patience, leverage policy windows for tactical entries, and strictly adhere to risk management. History shows that the main upward phase of crypto markets often begins quietly amid macro uncertainties, and May 2026 may be such a pivotal moment.