This excerpt is from the CoinDesk 'Daybook' newsletter. Subscribe now if you haven't already.
Bitcoin's price surged to $77,400, rising in tandem with other risk assets after major US tech companies released their earnings reports, helping to stabilize the market. The gains followed Apple's earnings report, which joined those of its peers, including Alphabet, Microsoft, Meta, and Amazon, all of which reported double-digit revenue growth. These earnings reports helped boost risk assets as renewed confidence in AI growth drew investors back into equities and crypto. However, the current bounce is primarily driven by relief buying rather than a conviction that a new rally has begun.
According to a note from crypto exchange Mercado Bitcoin, the market is experiencing 'short-term pressure with mixed structural factors,' including reduced hopes for rate cuts, ETF outflows, and increased geopolitical risk. Despite oil prices surging and over $400 million in outflows from spot bitcoin ETFs, crypto prices held steady as April came to a close. Oil prices remain a key factor, 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.
This could negatively impact crypto and other risk assets by making cash and bonds more attractive. The Federal Reserve maintained interest rates at 3.50% to 3.75% this week, with four dissenting voices, the most since 1992. Mercado Bitcoin noted that the decision and lack of clear rate-cut signals led markets to reprice 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, volatility may increase given Warsh's preference for tightening monetary policy. The key test for bitcoin remains at $80,000, and a break above this level could attract new buyers, while a failed move may trigger selling if leveraged longs unwind.
For analysis of today's activity in altcoins and derivatives, see Crypto Markets Today, and for a comprehensive list of events this week, see CoinDesk's 'Crypto Week Ahead.' Current trends and signals indicate that the weekly bitcoin price is testing rejection at the $80,000 resistance zone, with the RSI showing early signs of a bullish divergence, although this is unconfirmed on a weekly close. Failure to break above this level may keep the price range-bound between the 200-day exponential moving average of about $68,000 and the $80,000 level.