The value of Bitcoin, currently at $77,094.31, may face a setback despite its slight increase. Having gained less than 0.5% since midnight UTC, significant movements towards $80,000 are likely to encounter opposition. 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 if the price rises above this level, thereby limiting any potential gains. Furthermore, the upcoming US March PCE inflation report, coupled with high oil prices and rising bond yields, may exert downward pressure on risk assets.
The recent surge in West Texas Intermediate crude to $110 and reduced traffic through the Strait of Hormuz have made energy markets increasingly fragile. The Federal Reserve's decision to maintain the federal funds rate, accompanied by four dissenting votes, has also contributed to market uncertainty. Deans noted that altcoins remain closely tied to Bitcoin, with a high correlation and beta percentile of nearly 97% and 99%, indicating that they may move in tandem with Bitcoin.
He also stated that beneath the surface, conditions are forming that are typically associated with increased volatility, characterized by subdued liquidity and a lack of directional conviction, which may necessitate price movements to unlock new liquidity.