Bitcoin Sees Uptick as Tech Earnings Boost Market Sentiment, Despite Lingering Short-Term Pressures

This excerpt is from CoinDesk's 'Daybook' newsletter. Subscribe now for more insights. Bitcoin surged to $77,400, rebounding in tandem with other risk assets following the release of earnings reports from major US tech companies, which helped stabilize the markets. The upswing was triggered by Apple's earnings report, which, along with those of Alphabet, Microsoft, Meta, and Amazon, demonstrated double-digit revenue growth. Although the earnings reports have lifted risk assets, the current bounce is largely attributed to relief buying rather than a strong conviction that a new rally is underway. According to crypto exchange Mercado Bitcoin, the market is experiencing short-term pressure due to mixed structural factors, including diminished hopes for rate cuts, ETF outflows, and heightened geopolitical risk. Despite oil prices soaring and over $400 million in outflows from spot bitcoin ETFs, crypto prices remained steady as April drew to a close. The ongoing conflict in Iran and disruptions in the Strait of Hormuz have driven up crude prices, potentially fueling inflation and making central banks less inclined to cut interest rates. This, in turn, could negatively impact crypto and other risk assets by increasing the appeal of cash and bonds. The Federal Reserve's decision to maintain rates at 3.50% to 3.75%, despite four dissenting voices, has led markets to reassess policy expectations. According to Rony Szuster, head of research at Mercado Bitcoin, 'the market is expected to remain volatile and highly responsive to economic data in the short term, while the medium-term structure will depend on the stabilization of institutional flows and the trajectory of global monetary policy.' With Jerome Powell's term as Fed chair ending on May 15 and Kevin Warsh expected to chair the June FOMC meeting, potential volatility may arise due to Warsh's preference for tightening monetary policy. The crucial test for bitcoin lies at the $80,000 mark, where a breakthrough could attract new buyers, while a failed attempt may trigger selling if leveraged long positions are unwound. For in-depth analysis of today's altcoin and derivatives activity, visit Crypto Markets Today, and for a comprehensive list of upcoming events, see CoinDesk's Crypto Week Ahead. Current trends and signals indicate that the weekly bitcoin price is testing resistance at $80,000, with the RSI showing early signs of a bullish divergence, although this remains unconfirmed pending a weekly close. Failure to break above this level may keep the price range-bound between the 200-day exponential moving average of approximately $68,000 and the $80,000 level.