This excerpt is from the CoinDesk 'Daybook' newsletter. Subscribe now if you haven't already. Bitcoin reached $77,400, rising alongside other risk assets after major US tech companies' earnings reports stabilized the market.
The gains followed Apple's earnings report, which, along with those of Alphabet, Microsoft, Meta, and Amazon, all showed double-digit revenue growth and improved industry sentiment. The earnings reports lifted risk assets as renewed confidence in AI growth drew investors back to equities and crypto, although the current bounce is driven more by relief than conviction in a new rally. According to crypto exchange Mercado Bitcoin, the market faces 'short-term pressure due to mixed structural factors,' including lower hopes for rate cuts, ETF outflows, and increased geopolitical risks. Crypto prices remained steady this week despite oil price surges and over $400 million in outflows from spot bitcoin ETFs as April ended.
Oil prices are a key concern, 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 by making cash and bonds more appealing. The Federal Reserve maintained interest rates at 3.50% to 3.75% this week, with four dissenting votes, the most since 1992. Mercado Bitcoin noted that the decision and lack of clear rate-cut signals led to a repricing of policy expectations.
'In the short term, the market is expected to remain volatile and highly reactive to economic data,' said Rony Szuster, the company's head of research. 'In the medium term, the structure will depend on the stabilization of institutional flows and the path 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 key challenge remains at $80,000. Breaking through this level could attract new buyers, while a failed attempt may trigger selling if leveraged long positions are unwound.
Remain cautious. For further analysis of today's altcoin and derivatives activity, see Crypto Markets Today.
For a comprehensive list of this week's events, see CoinDesk's 'Crypto Week Ahead.' Current trends Today's signal The weekly bitcoin price chart is testing resistance at $80,000, with the RSI showing early signs of a bullish divergence, although this is unconfirmed on a weekly close. Failure to break above $80,000 will keep the price range-bound between the 200-day exponential moving average of about $68,000 and that level.