Last week, the cryptocurrency market largely remained constant and ended the week with approximately the same market cap of $1.137 trillion. Even with better-than-expected PPI data, the crypto markets continued to experience a heavy pullback. The US indices held better strength than crypto markets and ended the week in positive and higher terms in percentage levels. The cryptocurrency markets have been under considerable downward pressure for a prolonged period. However, there are now indications of a slight stabilization, and positive commentary and updates from the Federal Reserve could potentially contribute to an upward trajectory.
Bitcoin Price Analysis:
The bulls are trying to push Bitcoin back above the psychological level of $27,000. This suggests that there could be strong buying at lower prices. At $28,140 and again at the support line around $28,300, the recovery rise is likely to run into a lot of sellers. If the price falls from the support above it, the bears will try again to push the BTC/USDT pair down to $26,550.
This is an important level to keep an eye on because if it breaks, selling could get worse and the pair could fall to $25,000. On the way up, the bulls will need to break above the support line around $28,140 to show that a new up move is about to start. The pair could go up to $29,000 first and then try to go above $31,500. The price of bitcoin seems to be set to remain in a range, but if risk aversion triggers a de-risking event, selling pressure may develop.
Fundamental Updates
The Core PPI m/m was on point with a 0.2% reading, while PPI m/m was better at 0.2% instead of the expected 0.3%. The positive data didn’t trigger a good rally but aligns with the broader signs of slowly cooling down inflation. The Retail sales and core retail sales have cooled down much better than expected and indicated the consumer’s understanding of how fragile the markets are.
Fed chairman Jerome Powell is set to speak on 19th May, with FOMC Meeting minutes scheduled to release on 24th May. Both events are crucial as the market is now pricing no further major interest rate hikes or big changes in the policy unless it’s extremely crucial for managing structural breakdowns like the banking crisis.
Bitcoin returns were -0.67% for this week. The Alpha Blue Chip Focused Strategy returns were 7.92% during the same period (11 MAY – 18 MAY). The Top Cap Digital Assets Strategy and Arbitrage Opportunities and Balanced Strategy returns were 5.78% and 2.16%, respectively.
