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Bitcoin surged to $77,400, rising in tandem with other risk assets after major US tech companies' earnings reports 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 boosted risk assets as renewed confidence in AI growth drew investors back to equities and crypto, although the current bounce is more indicative of relief buying than a conviction that a new rally has begun.
According to crypto exchange Mercado Bitcoin, the market is experiencing 'short-term pressure amidst mixed structural factors,' including diminished hopes for rate cuts, ETF outflows, and increased geopolitical risk. Despite oil prices surging and over $400 million in outflows from spot bitcoin ETFs as April ended, crypto prices held steady.
The ongoing Iran conflict and disruptions in the Strait of Hormuz could lead to higher crude prices, fueling inflation and making central banks less likely to cut interest rates, which could negatively impact crypto and other risk assets by making cash and bonds more appealing. The Federal Reserve maintained interest rates at 3.50% to 3.75%, 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 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, which could induce volatility given 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 long positions are unwound.
For more analysis on 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. The weekly bitcoin price chart is testing resistance at the $80,000 zone, with the RSI showing early signs of a bullish divergence, though this remains unconfirmed on a weekly close. Failure to break above this level keeps the price range-bound between the 200-day exponential moving average of about $68,000 and the $80,000 level.