This excerpt is from the CoinDesk newsletter 'Daybook.' Subscribe now if you haven't already. Bitcoin surged to $77,400, rebounding alongside other risk assets following the release of earnings reports from major US tech companies, which helped stabilize the markets. The gains followed Apple's earnings report, which, along with those of Alphabet, Microsoft, Meta, and Amazon, showed double-digit revenue growth and improved industry sentiment.
Although the earnings reports lifted risk assets and crypto, driven by renewed confidence in AI growth, the current bounce is attributed more to relief buying than a conviction that a new rally has begun. According to a note from crypto exchange Mercado Bitcoin, the market faces short-term pressure due to mixed structural factors, including reduced hopes for rate cuts, outflows from ETFs, and increased geopolitical risk. Despite oil price surges and over $400 million in outflows from spot bitcoin ETFs, crypto prices held steady as April closed. Oil prices remain a crucial factor, as higher crude prices due to the Iran conflict and disruptions in the Strait of Hormuz could fuel inflation, making central banks less likely to cut interest rates and potentially weighing on crypto and other risk assets.
The Federal Reserve maintained interest rates at 3.50% to 3.75%, with four dissenting voices, the most since 1992. Mercado Bitcoin noted that the decision and lack of clear rate-cut signals led to a repricing of policy expectations. The company's head of research, Rony Szuster, stated, 'In the short term, the market is expected to remain volatile and highly reactive to economic data.
In the medium term, the structure remains dependent on the stabilization of institutional flows and the path of global monetary policy.' With Jerome Powell's chairmanship at the Fed ending on May 15 and Kevin Warsh expected to chair the June FOMC meeting, potential volatility may arise given Warsh's preference for tightening monetary policy. The key test for bitcoin remains at the $80,000 level; a break could attract new buyers, while a failed attempt may trigger selling if leveraged long positions are unwound. For analysis of today's altcoin and derivatives activity, see Crypto Markets Today, and for a comprehensive list of this week's events, refer to CoinDesk's 'Crypto Week Ahead.' Currently trending: the weekly bitcoin price plot is testing resistance at $80,000, with the RSI showing early signs of a bullish divergence, though this remains unconfirmed on a weekly close. Failure to break above $80,000 could keep the price range-bound between the 200-day exponential moving average of about $68,000 and the $80,000 level.