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

Mid-May 2026, the cryptocurrency market continues its strong trend. Since breaking the $80k threshold on May 4, Bitcoin has been steady between $80k and $82k, with a monthly increase of over 20%. If the current month closes positively, it will mark a historic pattern of three consecutive months of positive returns 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 Fed Chair Powell will step down on May 15 and Kevin Warsh, known as the "crypto-friendly" candidate, will succeed him, the market is shifting from "defensive regulation" to "integrated 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 expectations of liquidity easing
On May 15, Fed Chair Jerome Powell will officially step down, with Kevin Warsh taking over, seen as a significant turning point in US cryptocurrency policy. During Powell’s tenure, Bitcoin was always regarded as a "speculative asset," while Warsh is considered by industry insiders as the "most crypto-savvy" Fed Chair candidate in history. His appointment signals a shift in US crypto policy from "defensive and preventive" to "integrative and innovative."
This personnel change occurs amid major adjustments to Fed liquidity tools. According to previous policy directions, the Fed has canceled the daily $500 billion limit on standing repurchase agreements (SRP), allowing banks to borrow from the Fed without restrictions using government bonds as collateral, significantly raising the market liquidity ceiling. If Warsh further promotes a dovish monetary policy stance, lower borrowing costs will directly benefit high-risk assets like cryptocurrencies. Investors should closely monitor market volatility around May 15, as history shows that major personnel transitions often cause short-term liquidity disturbances, but the medium-term direction is likely to remain accommodative.
2. Institutional Capital Inflows: ETF continuous net inflows reshape market structure
In April, US spot Bitcoin ETFs saw the highest monthly capital inflow since 2026, totaling $1.97 billion, pushing ETF holdings past $100.5 billion. BlackRock’s iShares Bitcoin Trust (IBIT) alone attracted about $2.01 billion in net new money, increasing assets under management to $61.9 billion, making it the preferred channel for institutional Bitcoin allocation.
This capital strength indicates ETF buying has reached several times the amount of miner output, 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 institutional funds are shifting from "tentative allocation" to "strategic accumulation." Wang Peng, a deputy researcher at the Beijing Academy of Social Sciences, points out that the fundamental market structure has changed—US spot Bitcoin ETFs are forming 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 for May 2026 shows that the total market cap of stablecoins reached a record high of $315 billion in Q1, with quarterly trading volume hitting $28 trillion, an annualized scale more than double that 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 change in the underlying liquidity of the crypto market.
3. Technical Structure Analysis: The battle between key resistance and support levels
From price action, Bitcoin surged past $80k in the early hours of May 4, reaching a high of $82,430, then entered a consolidation phase between $80k and $82k. As of May 12, Bitcoin closed at about $80,742, up roughly 5% since May began.
On the technical side, the 200-day moving average is currently at $83,842, a critical dynamic resistance level that Bitcoin has not effectively broken since January 2026. Moneta Markets’ forex analysis indicates that the next key target for professional investors is around $85,200. If prices rise to this level, market makers holding short gamma positions near $82,000 will trigger hedging buy orders, further supporting upward momentum.
Looking at the longer-term Bitcoin rainbow chart, the current price remains in the "buy" zone of the mid-cycle (approximately $77,630 to $100,127), not yet entering the "accumulate" or "hold" zones, suggesting the market is not overheated and long-term valuation supports further upside. Although the MACD remains negative, the histogram is gradually shrinking, indicating waning downward 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 a yearly gain of 29.15%, outperforming Bitcoin. Its rally is mainly driven by ongoing on-chain ecosystem iterations and mature Layer 2 scaling solutions, leading to a revaluation of its long-term value. The $2,300–$2,500 range for Ethereum forms a mid-term support and resistance zone. If Bitcoin successfully breaks $85,000, Ethereum could test its previous high near $2,800.
4. Market structure signals: The significance of three consecutive months of positive closes
A key yet undervalued signal is that if Bitcoin closes above $80k in May, it will confirm three consecutive months of positive returns in March, April, and May. Moneta Markets emphasizes that such three-month positive closes have 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 clearly released. Leverage levels are within healthy ranges, with no signs of the excessive speculation that caused extreme funding rates in Q4 2025. This indicates the current rally is mainly driven by spot buying rather than leveraged speculation, making the market structure more solid.
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 is recommended to gradually build long positions in the $79,000–$80,500 range, with a stop-loss at $77,500 (below the April 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 closes with Bitcoin above $80k, consider increasing Bitcoin holdings to 40–50% of total crypto assets, with Ethereum at 30–35%, and 15–20% allocated to quality Layer 1 chains and DeFi blue chips. The mid-term target is $100,000, the "accumulate" zone on the rainbow chart, and the last major resistance before the October 2025 high of $126,073.
Variables to monitor include: Warsh’s first public speech, US crypto legislation progress, and whether spot Ethereum ETF fund inflows can replicate Bitcoin ETF trends.
Risk warnings
First, the $83,842–$85,200 zone is a confluence of multiple technical resistances. If three attempts to break through fail, beware of exhaustion of bullish momentum leading to 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 from "buy the rumor, sell the news," 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 disrupt the current supply-demand balance and trigger trend reversals. Daily tracking of SoSoValue’s ETF fund flow data is recommended as a key reference for 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 launching an assault toward $88,000–$92,000. Mid-term (Q3 2026), if the Fed begins 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 positioning, and strictly adhere to risk management. History shows that the main upward wave in crypto markets often quietly begins amid macro uncertainties, and May 2026 is precisely such a turning point.