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

This excerpt is from the CoinDesk newsletter 'Daybook.' To subscribe, click here. Bitcoin rose to $77,400, mirroring gains in other risk assets following the release of earnings reports from major U.S. tech companies that stabilized market confidence. The upswing was fueled by Apple's (AAPL) earnings report, which joined those of its peers, including Google's parent company Alphabet (GOOG), Microsoft (MSFT), Meta (META), and Amazon (AMZN), all of which reported double-digit revenue growth earlier in the week. These earnings reports contributed to an increase in risk assets as renewed faith in the AI growth narrative drew investors back to equities and cryptocurrency. However, the current rebound is attributed more to relief buying than a conviction that a new rally has commenced. According to a note shared with CoinDesk by crypto exchange Mercado Bitcoin, the market is experiencing 'short-term pressure amidst mixed structural factors,' including diminished hopes for rate cuts, outflows from ETFs, and heightened geopolitical risk. Crypto prices remained steady this week despite a surge in oil prices and outflows of over $400 million from spot bitcoin ETFs as April drew to a close. Oil prices remain a crucial factor, as higher crude prices stemming from the Iran conflict and disruptions in the Strait of Hormuz could exacerbate inflation. This could make central banks less inclined to cut interest rates, potentially impacting 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 voices marking the most since 1992. Mercado Bitcoin noted that the decision and lack of clear signals for rate cuts led to markets repricing policy expectations. 'In the short term, the market is expected to remain volatile and highly sensitive 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 trajectory of global monetary policy.' With Jerome Powell's chairmanship at the Fed set to end on May 15 and Kevin Warsh expected to chair the June FOMC meeting, volatility may increase given Warsh's preference for tightening monetary policy. The crucial test for bitcoin remains at the $80,000 mark. A breakthrough could attract new buyers, while a failed attempt may trigger selling if leveraged long positions are unwound. Remain vigilant! For more analysis of today's activity in altcoins and derivatives, visit Crypto Markets Today. For a comprehensive list of events this week, refer to CoinDesk's 'Crypto Week Ahead.' Current trends Today's signal The weekly bitcoin price chart is testing resistance at the $80,000 zone, with the RSI showing early signs of a bullish divergence – the price has printed a lower low while the RSI has held higher, though this has not been confirmed on a weekly close. Failure to break above this level will keep the price range-bound between the 200-day exponential moving average of approximately $68,000 and the $80,000 level.