This text appears to be a summary of news articles and analysis related to the cryptocurrency market, specifically Bitcoin (BTC), for the week of May 13, 2024. The following are the key takeaways:
Bitcoin (BTC) begins the new week by maintaining its position above the crucial support level of $60,000, as market sentiment remains on the fence between optimistic and pessimistic outlooks.
The current behavior of Bitcoin’s price remains confined within a limited trading band. What might lead to a significant shift in this pattern?
This week presents an equal opportunity for heightened volatility in the cryptocurrency market. The release of key economic data from the United States and remarks from Jerome Powell, the Federal Reserve Chairman, may create a potentially volatile situation for risk assets.
For Bitcoin supporters, there’s a lot riding on the current situation – the market has given hints of a more significant decrease, and investors have identified potential upcoming price points.
As a researcher studying the Bitcoin (BTC) market, I’ve noticed that the bid liquidity primarily concentrates around the $50,000 mark, making it an enticing region for potential longer-term market bottoms. However, on shorter timeframes, BTC/USD appears more inclined towards clearing liquidity to the upside as the week commences.
CryptoMoon takes a look at the current state of play when it comes to BTC/USD performance.
BTC price: It’s all about $60,000
Bitcoin’s understated weekly closing indicates that it remains in well-trodden ground as the Traditional Finance (TradFi) market activities commence for the week.
As an analyst examining the data from CryptoMoon Markets Pro and TradingView, I’ve observed that Bitcoin’s price action against the US Dollar has been relatively stable leading up to the weekend.
As an analyst, I would point out that the price of $60,000 has remained a significant resistance level since its reclamation on May 3. For many market participants, breaching this threshold could signal the end of the current bullish trend.
As an analyst, I’ve noticed an intriguing development while examining the chart shared on X, formerly known as Twitter. A significant group of bidders has expressed strong buying intent at a price point slightly beneath $60,000. This bullish order block could potentially serve as a supportive factor in the market if this level is revisited.
“Bitcoin still holding above 60k and the down trend break,” he wrote.
“That blue OB is going to be the key in the short term, lose it & we revisit the lows & likely much lower. Hold and another leg to take liquidity above the highs at 64-67k is likely.”
This week’s economic reports, with a focus on the Consumer Price Index (CPI) scheduled for release on May 14, are expected to significantly influence Bitcoin’s price movements according to Cullen.
According to CryptoMoon’s report, the $60,000 mark is significant for several reasons. This level isn’t just where buyers are placing their bids; it also coincides with crucial moving averages and other trends that typically emerge during a bull market.
Daan Crypto Trades, a well-known trader, pointed out that the “support band” in a bull market is still helping to keep prices afloat.
Last week, I observed the market bounce back from the support band where the Bull market had previously leveled off. I shared this observation with my X followers over the weekend.
“So far during this and previous bull cycles, it has offered good support. Let’s see how we do from here.”
The support band is formed of two exponential moving averages, or EMAs.
According to the most recent information from monitoring tool CoinGlass, a significant $65 million worth of bids were added during the night leading up to May 13, with the average price being approximately $60,250.
As a financial analyst, I would describe it as follows: A reservoir of ask liquidity, previously hovering above the $62,000 mark, is being drawn down, potentially setting the stage for the next significant price confrontation.
The day before, Skew, another trader, expressed his suspicion that “passive buying at the spot market” might be preventing Bitcoin’s price from challenging the $60,000 support level.
“Overall good spot bid depth $60K – $58K,” part of X comments added.
CPI hits as Fed’s Powell due to speak
As a researcher focusing on macroeconomics, I’m closely monitoring the latest developments in the U.S. economy this week. A flurry of data releases is expected to provide valuable insights into various economic indicators.
Inflation discourse and anticipation of interest rate decreases revolve around the Consumer Price Index (CPI).
Before May 14, the Producer Price Index (PPI) for April is scheduled to be released, as well as a public speaking engagement from Federal Reserve Chairman Powell.
At the yearly gathering of the Foreign Bankers’ Association in Amsterdam, Powell is set to engage in a conversed analysis of economic matters with Klaas Knot, who presides over De Nederlandse Bank as its chief.
As a crypto investor, I’ve noticed that the markets react strongly to the tone used by Jerome Powell in his speeches about future monetary policy.
As an analyst, I’d interpret the recent data from CME Group’s FedWatch Tool in this way: According to the market sentiment, there is almost no expectation for the Federal Reserve to reduce interest rates during their upcoming meeting in June. However, the probability of a rate cut significantly rises in September, based on current market predictions.
“If inflation as measured by the Consumer Price Index (CPI) goes up once more this week, it will signify the third consecutive monthly rise.” The Kobeissi Letter observed in its weekly macro diary post on X that the upcoming days promise to be quite eventful.
Long-term holders halt 2024 BTC distribution
Seasoned Bitcoin hodlers are channeling the 2021 bull market, as seen through some on-chain data.
As a market analyst, I’m observing a noteworthy trend unfolding among long-term Bitcoin (BTC) investors. Throughout 2024, these investors have been offloading some of their holdings to the market. However, in a promising turn of events, they are now actively increasing their BTC exposure once again.
This is the conclusion of J. A. Maartunn, a contributor to on-chain analytics platform CryptoQuant.
He contended that similar to the middle of last year, LTH entities are trying to seize a larger portion of the Bitcoin market by uploading some of their recent discoveries to X.
In a CryptoQuant analysis, Maartunn points out that the current relatively low cost of Bitcoin is tempting investors to buy coins in large quantities for later resale during market excitement.
“Interestingly, a trend line can be drawn between the data points from 2018, 2021, and 2024. There’s a cyclical trend occurring, as previously described, where long-term holders buy in bear markets and sell in bull markets. However, a broader and more enduring trend is also at play: despite this cyclical trend, an increasing share of bitcoin is steadily being held by long-term holders.”
According to CryptoMoon’s report, short-term Bitcoin and Ether (ETH) investors, often referred to as speculators, have established a new resistance level that has held strong during this ongoing bull market.
Funding rates reset endures across crypto
For those monitoring the Bitcoin and altcoin markets, signs point to a potential shift in market conditions, bringing about more diversity and variation in the near future.
In derivatives markets, the current scene reflects a notable neutrality that has emerged in the crypto sector.
Specifically, funding rates stay constant irrespective of short-term price fluctuations. Consequently, Bitcoin’s surge to record highs in March appears as a brief anomaly on the chart.
“According to Daan Crypto Trades, the funding rates for crypto have been at a neutral level for an extended period, which is longer than when they were overheated in February and March.”
CoinGlass data shows a broad funding reset coming at the end of March.
As a researcher examining market trends, I would describe it this way: “The market progresses in cycles: slow and sluggish, followed by sudden growth and overheating, ultimately leading to a correction or reset. This pattern repeats itself.”
“Fear and indecision”
Although prices generally stay within a set range, cryptocurrencies exhibit signs of price instability in other areas.
The Crypto Fear & Greed Index, a widely-used indicator of market sentiment in the cryptocurrency world, has been fluctuating between different conditions this month.
As a crypto investor, I closely monitor the market using a lagging indicator that analyzes a collection of elements influencing the behavior of traders. When this indicator shows signs of impulsiveness with notably high readings, it may be an indication of an abrupt market correction or reversal, similar to a sudden knee-jerky response.
As a crypto investor, I’ve noticed that the Fear & Greed Index stood at 57 out of 100 on May 13. Compared to the reading of 71/100 just a few days prior on May 6, this is a more neutral indicator. We’re close but not quite in the “extreme greed” zone yet.
Last week, in my latest analysis, I attributed the decline in Bitcoin’s on-chain activity to feelings of fear and indecision among traders, according to the research conducted by Santiment.
A chart that came alongside the data showed that the total number of on-chain transactions had declined to figures not seen since late 2019.
As a researcher studying Bitcoin’s transactional data, I’ve observed that the on-chain activity is nearing record lows. The past two months have seen a significant decrease in trading transactions since Bitcoin reached its all-time high.
“This isn’t necessarily a sign of more $BTC dips, but rather a signal of crowd fear and indecision.”
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2024-05-13 12:06