LIVEBitcoin Price Could Be Close to Bottoming Out! Is $67,000 next?
Bitcoin experienced a dramatic crash between April 30 and May 1, dropping by 11.5% to $56,522. This sharp decline triggered $172 million in leveraged long position liquidations.
The Fed Minutes
Investors are waiting for more signals from the Federal Reserve. Analysts say many are holding off until Jerome Powell, the Fed's chair, delivers his speech following the two-day monetary council meeting on May 1.
Also, concerns over the US Treasury Department's ability to finance the government's budget persist. On 30 April, the yield on the US Treasury 2-year note reached a 5-month high of 5.06%, as investors sought safer returns amid rising risk. The US deficit has soared to $1.07 trillion for the first half of 2024, leading to higher interest costs - this growing uncertainty is impacting BTC & other risk assets.
Markets Are Turning Risk-Averse
BTC crash reflects a broader trend of increasing risk aversion. Over the past 30 days, the Russell 2000 Index, which tracks smaller US-listed companies, fell by 8.2%, erasing gains from the previous two months. Similarly, WTI oil prices dropped by 8.3% since 5 April, reaching $87.91 after hitting a 5-month high.
Positive Corporate Earnings and Miners Remain Strong
Despite BTC's downturn, traditional markets show signs of recovery following strong first-quarter earnings reports from major companies like Amazon, Microsoft, & Google. If the Fed maintains high rates, BTC could attract renewed attention.
Bitcoin miners are under pressure after the recent halving, but they're not showing signs of capitulation yet. Miner outflows to exchanges indicate miners are holding their ground, even with the recent 57% drop in the Hashrate Index, which measures the daily return of one terahash of hashing power.
China’s Crypto Demand Points to Positive Sentiment
An interesting development in China offers a glimmer of hope for BTC. The premium on USDC in China rose to 2.7% on May 1, indicating that Chinese investors are still interested in cryptocurrencies.
