The value of Bitcoin, currently at $79,058.43, may experience a setback despite its slight increase. The cryptocurrency has seen less than a 0.5% gain since midnight UTC, and any significant move towards $80,000 is likely to encounter resistance. According to Luke Deans, a senior research associate at Bitwise, short-term holders have a cost basis around $80,000, which may prompt them to sell and realize profits, thereby limiting any potential advance. Additionally, the upcoming US March PCE inflation report, coupled with high oil prices and rising bond yields, may further weigh on the market.
The recent decision by the Federal Reserve to maintain the federal funds rate has also introduced uncertainty, with four dissenting voices advocating for a rate cut or opposing the suggestion of future easing. Deans noted that altcoins remain closely tied to Bitcoin, with a high correlation and beta percentiles of 97% and 99%, respectively. This suggests that altcoins may mirror the performance of Bitcoin. Deans warned that beneath the surface, conditions are ripe for increased volatility, characterized by subdued liquidity and a lack of directional conviction, which may require significant price movements to unlock new liquidity.