Fed dovish signals boost gold and silver, Bitcoin rises driven by retail investors, Arthur Hayes reiterates the $1 million price target.

The Fed's dovish interest rate cut signals and weak U.S. economic data provide a favorable macro backdrop for gold and silver, both of which show bullish technical patterns and are expected to challenge historical highs. Meanwhile, Bitcoin's price remains stable around $117,500, driven by the activity of retail investors, while the absence of large investors reduces the risk of significant short-term pullbacks. This article will analyze the current market dynamics and future trends of these assets from multiple dimensions, including macro, technical, and investor composition.

Macroeconomic Background: Fed Rate Cuts and the Slowdown of the US Economy

Gold and silver continue to maintain their upward momentum under the dovish signals from the Fed, the slowdown in U.S. economic growth, and the trend of a weakening dollar. The Fed has lowered its benchmark interest rate by 25 basis points, bringing the target range down to 4.0%–4.25%. Fed Chairman Powell is walking a tightrope between balancing political pressure and market expectations. Notably, one member of the Federal Open Market Committee (FOMC) voted against, advocating for a larger cut of 50 basis points. This divergence indicates that the Fed is leaning towards a more dovish direction while maintaining its credibility.

At the same time, economic data shows that the U.S. economy is slowing down. Job growth has slowed, and the unemployment rate is rising. In addition, the inflation rate remains high at 3.0%, well above the Fed's long-term target of 2.0%. The slowdown in growth and stubborn inflation create a favorable environment for gold. Financial conditions remain loose, with the Chicago Fed's NFCI index dropping to -0.558, indicating ample market liquidity. Furthermore, U.S. Treasury yields are on a downward trend. Powell is cautiously balancing Trump's stimulus demands and the market's need for stability. A deeper rate cut could trigger a bond sell-off, while refusing to cut rates could provoke a political backlash. This uncertainty supports a bullish outlook for gold, and investors may turn to gold as a hedge against inflation and a tool to avoid political risk.

Gold and Silver: Bullish Signals for Safe-Haven Assets

Gold Technical Analysis

· Daily chart: bullish consolidation

· The daily chart of spot gold shows that the price has been consolidating within an ascending channel near record highs after reaching the resistance level around $3,700. The pullback from this resistance level provides the next buying opportunity, with the next target being $4,000. Strong support remains in the $3,500 to $3,600 region. A pullback to this area offers an ideal entry point for long-term investors.

· 4-hour chart: Actively consolidating

· The 4-hour chart of spot gold shows a key reversal at the rising channel support level at $3,640. This rebound could push gold prices towards the $3,700 area. Additionally, the RSI indicator is rising, indicating that the bullish momentum of spot gold is recovering.

Silver Technical Analysis

· Daily chart: Strong bullish momentum

· The daily chart of spot silver shows that the price has experienced a pullback following the Fed's interest rate decision. However, the market has largely priced in the expectations of a rate drop, and the pullback has resumed the bullish trend under strong support. As long as silver holds above 40 dollars, the next move is likely to continue rising. The key resistance level remains in the 44 dollar range, and a breakthrough at this level could trigger a strong rebound towards the 50 dollar area.

· 4-hour chart: Positive price development

· The 4-hour chart for spot silver shows that prices are trading within an ascending broadening wedge pattern, finding strong support near the lower boundary around $40.90. A rebound from this support level could push silver prices towards the resistance zone near the $44 area. The bullish price structure over the past year, including the formation of an inverted head and shoulders pattern, suggests that silver prices are likely to continue rising.

Dollar Index: Rebound Stalled, Overall Trend Bearish

Technical Analysis of the Dollar Index

· Dollar Daily Chart: Reversal After Fed Rate Cut

The daily chart of the US Dollar Index shows that it has broken below the bearish flag pattern and continues to decline. However, after the Fed made less dovish remarks, the index rebounded from the long-term support level of 96.50. Despite the rebound, the overall price trend remains bearish, and this uptick may encounter resistance, leading to a further drop in the index.

· Dollar 4-hour chart: negative price movement

· The 4-hour chart of the Dollar Index shows that it is oscillating between 96.50 and 98, with an overall price trend leaning towards the negative. Although it rebounded strongly from 96.50, the continued trading below 100.50 indicates persistent bearish momentum. A decisive break below 96.50 could trigger a sharp drop towards the 90 level.

Bitcoin: Retail-Driven Equilibrium Market and Divergent Expert Opinions

While precious metals are rising due to macroeconomic benefits, Bitcoin (BTC) is also holding around $117,500, having risen about 6.1% in the past two weeks. However, the latest data from Binance shows that the current price movement of Bitcoin is mainly supported by retail investors, while whales (Large Investors) are noticeably absent.

Bitcoin holds above $117,500 under retail investment inflow.

According to a Quicktake post by CryptoQuant contributor Arab Chain, the current price level of Bitcoin is mainly supported by the inflow of funds from active retail investors. Notably, the inflow from large whales is completely absent, indicating that the current market is driven more by individuals rather than large wallets. The inflow volume for transactions between 0 and 0.001 BTC recorded approximately 97,000 Bitcoins. Similarly, the total inflow from 0.001 to 0.01 BTC is close to 719,000 Bitcoins.

The above distribution indicates that the current rise of Bitcoin is mainly driven by retail investors. These investors engage in a large number of small transactions, confirming that individual investors are shaping market dynamics. Arab Chain added, "Data shows that most of the capital inflow is concentrated in small and medium-sized trades, reflecting the dominant position of retail activity in Bitcoin trading. Despite limited liquidity scale, it helps maintain balance in the market at current levels." It is worth emphasizing that there is almost no pressure from whales during the current market uptrend. Specifically, there has been no significant influx of funds exceeding 100 BTC, thereby reducing the likelihood of a sharp price pullback in the short term. In summary, the current market situation indicates that Bitcoin is experiencing a state of balance, primarily due to increased participation from retail investors. This situation provides an opportunity for the market to steadily rise to the important resistance level of $120,000. Nonetheless, it would be wise to monitor any whale activity, as it could quickly change market direction. Any sudden influx of whale funds could trigger a rapid price pullback, similar to previous market tops.

Experts have differing opinions on the price trend of Bitcoin.

Despite Bitcoin's current trading price being approximately 5.4% lower than its historical peak, there are signs that this top cryptocurrency by market capitalization may be on the verge of a new round of rises. For instance, BTC recently broke through the breakeven point for medium-term holders, reducing the likelihood of immediate sell-offs. Recent positive developments—such as the Fed's decision to lower interest rates by 25 basis points—could rejuvenate the crypto market. In this context, crypto entrepreneur Arthur Hayes recently reaffirmed his ambitious $1 million BTC prediction. Nevertheless, gold supporter Peter Schiff believes that BTC may have already peaked in this market cycle. As of the time of writing, BTC is trading at $117,523, having risen by 1.8% in the past 24 hours.

Conclusion

This market cycle demonstrates a complex and interesting dynamic between precious metals and cryptocurrencies. Gold and silver, as traditional safe-haven assets, are receiving solid support from the Fed's dovish policies and macroeconomic uncertainty, with clear bullish signals also appearing in their technical analysis. Meanwhile, Bitcoin is showing a unique equilibrium state dominated by retail investors, which not only limits its short-term upward momentum but also avoids the severe risks brought by large institutional sell-offs. These two trends together paint a grand market picture: against a favorable macro environment, traditional safe-haven assets and emerging digital assets are attracting capital in different ways. Investors need to pay attention to both the macro signals from traditional finance and the unique on-chain data from the crypto market to fully understand and seize future market opportunities.