This excerpt is from CoinDesk's 'Daybook' newsletter. Subscribe here if you haven't already. Bitcoin reached $77,400, rising alongside other risk assets as strong earnings reports from major US tech companies helped stabilize the market. The gains followed Apple's earnings report, which, along with those of Google's parent company Alphabet, Microsoft, Meta, and Amazon, showed double-digit revenue growth.
These reports helped boost risk assets and crypto as renewed confidence in AI growth drew investors back in, although the current bounce is more about relief than the start of a new rally. According to crypto exchange Mercado Bitcoin, the market faces 'short-term pressure with mixed structural factors,' including lower hopes for rate cuts, ETF outflows, and increased geopolitical risk. Despite oil price surges and over $400 million in outflows from spot bitcoin ETFs, crypto prices held steady as April ended. Oil prices, influenced by 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 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. '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 remains dependent 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, which could induce volatility due to Warsh's preference for tightening monetary policy, the key test for bitcoin remains at $80,000.
A break above this level could attract new buyers, while a failed attempt may trigger selling if leveraged 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, see CoinDesk's Crypto Week Ahead. Currently trending is the bitcoin price testing rejection at the $80,000 resistance zone, with the RSI showing early signs of a bullish divergence, though this remains unconfirmed on a weekly close.
Failure to break above $80,000 keeps the price range-bound between the 200-day exponential moving average of about $68,000 and the $80,000 level.