Bitcoin, currently at $76,290.76, may face a challenge despite its slight gains. The cryptocurrency has seen less than a 0.5% increase since midnight UTC, and any significant move towards $80,000 is likely to be met with resistance. According to Luke Deans, a senior research associate at Bitwise, short-term holders have a cost basis around $80,000, which could prompt them to sell and take profits, thereby limiting any potential advance. The release of the US March PCE inflation report, coupled with high oil prices and rising bond yields, may also pose a challenge.
The recent surge in West Texas Intermediate crude to $110 and reduced traffic through the Strait of Hormuz have kept energy markets on edge. Furthermore, the Federal Reserve's decision to maintain the federal funds rate, along with the presence of dissenting voices, has added to market uncertainty. Deans notes that altcoins remain closely tied to Bitcoin, with a high correlation and beta percentile, indicating that tokens may move in tandem with Bitcoin.
He also warns that beneath the surface, conditions are forming that could lead to increased volatility, with subdued liquidity and a lack of directional conviction. In such environments, significant price movements are often necessary to unlock new liquidity.