After Bitcoin lost around 17% of its value in April on a monthly basis, it started May with moderate gains. On Monday afternoon, the leading digital currency gained about 2% in the friendlier overall market. However, the next test is already imminent.
Despite the gains earlier this week, the situation in the crypto market remains tense. The main reason for this is the upcoming US Federal Reserve meeting this week. Given the sharp rise in inflation, market watchers strongly expect Fed Chairman Jerome Powell to announce another rate hike on Wednesday, May 4.
Interest rates are expected to rise by 50 basis points, the biggest rise since 2000. In addition, concrete steps to melt the central bank’s balance sheet, which now weighs around nine trillion dollars, are expected to be announced.
Whether and to what extent the measure known as “Quantitative Tightening” (QT) and further interest rate increases by the Fed are already priced into Bitcoin and Co., opinions from industry experts also differ. . In principle, however, tighter monetary policy is considered a stumbling block for riskier asset classes such as equities or cryptocurrencies – which is already reflected in the price losses of these assets these days. last months.
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Bitcoin is currently trading nearly 45% below its all-time high from early November 2021 at around $69,000. It is true that it continues to evolve in a valid sideways range since the beginning of the year. However, after breaking below previous chart technical support around $40,000 last week, it is now crystallizing as resistance on the way back.
Due to the great uncertainty surrounding the future course of central bank policy, inflation, the strength of the dollar and other potentially negative macroeconomic factors, industry watchers are looking downside anyway. short and medium term. Initially, the focus is on support at around $37,500 and the year-to-date low of around $33,000 at the end of January.
In case these marks are also torn apart, some are already expecting a retest of the important 30,000 mark. In this area, however, supportive buying is likely, which could sharply increase trading volume, which has tended to decline recently.
DER SHAREHOLDER expects that, at least for the foreseeable future, it will be mainly macroeconomic factors that will continue to determine Bitcoin’s price. Meanwhile, positive crypto-specific news is barely heard. The long-term positive valuation continues to apply, but Bitcoin fans and investors need patience and strong nerves.
Notice of conflict of interest:
The CEO and majority owner of the publisher Börsenmedien AG, Mr. Bernd Förtsch, has taken direct and indirect positions in the following financial instruments mentioned in the publication or related derivatives which benefit from any price movements resulting from the publication: Bitcoin.
The editor-in-chief of the publisher Börsenmedien AG, Mr. Leon Müller, has taken direct and indirect positions in the following financial instruments mentioned in the publication or related derivatives which may benefit from any price developments resulting from the publication: Bitcoin.
The author holds direct positions in the following financial instruments mentioned in the publication or related derivatives that may benefit from any price movements resulting from the publication: Bitcoin.
The stocks or derivatives discussed/mentioned in this article can be found in the “AKTIONÄR Depot” of DER AKTIONÄR.