- Crypto markets ended the quarter as one of the best-performing financial sectors, despite a constant stream of unfavourable press. BTC was in the lead, up 70% year to date.
- On April 12, the Ethereum network will undergo a significant upgrade, so we can anticipate intense market activity.
- Following a CFTC lawsuit and the decision to end its zero-fee trading program, Binance has lost 16% of the market share of trade volume over the last two weeks. With a 54% market share, the exchange is still the biggest within the crypto space.
- The US industrial production index fell for the fifth consecutive month, reaching its lowest level since May 2020, the COVID bottom period.
- The president of the Federal Reserve Bank of St. Louis says that OPEC+’s cuts to oil production will make it hard for the Fed to keep inflation in check.
- Following the banking turmoil in the US and Europe, there will be a lot of uncertainty in the coming months regarding the growth and inflation trajectories.
- The contrary opinion is that the Fed will keep interest rates high for a longer period of time than the markets are anticipating and that this high-rate regime will come to an abrupt end with a hard landing.
Volatility has shaken the cryptocurrency market, but Bitcoin BTC continued to increase by about 23% in March. On April 3, Bitcoin’s price rose after initially declining. After several OPEC+ participants announced they would reduce oil production by a combined 1.65 million barrels per day through the end of the year, there was an increase in volatility. According to some analysts, this action will cause a supply shortage, raising petrol prices. Consequently, inflation may increase, necessitating central banks’ continued hawkish stance.
The US dollar index (DXY) started out on the upswing but was unable to maintain the rally throughout the day. This may indicate that traders do not anticipate a significant change in the U.S. Federal Reserve’s stance as a result of the event. In general, risky assets are thought to benefit from a weaker DXY. Despite unfavorable macroeconomic news and regulatory action against cryptocurrency firms in recent days, cryptocurrencies have held their ground. Negative news does not cause the price of an asset to crash, which indicates that traders are not fleeing in panic and liquidating their holdings.
Since March 17, cryptocurrency markets have been fluctuating within an unusually small 5% range as competing forces continue to exert pressure on the industry. As a result, over the past week, the total market capitalization increased by 3.5+%, primarily due to price increases in Ether (ETH) and Bitcoin (BTC) of 4+% and 3+%, respectively.
Fear and Greed Index for Bitcoin Remains "Greedy":
The Commodity Futures Trading Commission (CFTC) filed a civil enforcement action against Binance and its CEO, Changpeng Zhao, for allegedly offering unregistered crypto derivatives products in the U.S. Since hitting a low of 57, the Bitcoin (BTC) index has been moving upward. BTC dropped by 3% as a result of the news.
A year ago, two weeks ago, the Bitcoin Fear and Greed Index reached its highest level of 68. According to the CoinMarketCap data, BTC actually last reached this level in November 2021, when it reached an all-time high of almost $69,000, according to the data. Despite the index never reaching 68 once more, BTC has since recovered, and the market sentiment has stayed in the greed zone, indicating a bullish investor sentiment.
The Crypto Fear and Greed Index shows readings between 0 and 50, with readings below 50 indicating fear, and readings above 50 indicating that the market sentiment has entered the stage of greed. Due to a wave of unfavorable news and industry bankruptcies, the BTC Index record was stuck in the fear and extreme fear regions for the majority of 2022.
The return of greed, however, occurred in 2023 as a result of a rebound in cryptocurrency prices in spite of macroeconomic conditions and regulatory crackdowns.
Bitcoin Price Analysis:
The $29,000 level of resistance for bitcoin is strong, but the bulls have prevented the price from falling. This implies that the bulls are being patient and looking forward to a rise. After buyers get past the resistance level at $29,000, the bullish momentum is likely to increase. That might trigger a rally to $30,000 and then to $32,000. On the other hand, it will indicate that short-term traders are selling if the price declines significantly from its current level. It’s important to keep an eye on the $26,000 level in case the BTC/USDT pair declines to that level. The pair might fall to the breakout level of $25,250 if this support crumbles.
Concluding Thoughts:
In the derivatives market, the odds of a decline are priced higher. Trading activity on futures markets is balanced, but until regulators’ actions are more clear, traders are hesitant to place more bets. Although professional traders are not currently placing bets on it, it is unclear whether the total market capitalization will be able to surpass the $1.2 trillion threshold. Whether the total market capitalization will be able to pass the $1.2 trillion threshold is uncertain. For a variety of reasons, people own bitcoin. The “greater fool” theory is one plain reason. Another reason is that they require a pseudonymous method of value transfer. A second is a conviction in its monetary merits or the worth of decentralised self-custody. The failure of Silicon Valley Bank, Signature Bank, and the liquidation of Silvergate Bank in March caused a significant banking crisis in the market. In Europe, the government facilitated UBS’s compelled acquisition of Credit Suisse. In spite of this, both the US and European stock markets ended the month on a high note.
Although volatility shook the cryptocurrency market as well, Bitcoin BTC gained about 23% in March. The outlook for Bitcoin bulls in April is positive going forward, and data from Coinglass suggests that the month has been largely in their favour.
