Bitcoin Weekly Review
For the fifth week in a row, Bitcoin has traded in the red against the US dollar. At the time of writing the review, Bitcoin is worth $37,855. Weekly losses are 3.77%.
During the week, the correlation value between Bitcoin and S&P500 futures was 0.86. This indicates that crypto investors continue to monitor the situation in the US stock market.
The American indices decreased following the results of the week and the month. The three major stock indexes lost between 2.7% and 4.2%. Corporate reports for the 1st quarter of 2022 did not inspire optimism. Investors reacted negatively to the results of Amazon Inc., which reported its first loss in seven years. Tesla shares fell 12% after Elon Musk bought Twitter.
On April 25 and 28, the indices tried to resume their upward movement. Along with them, the biotin rate rose to $40,797. On Friday, the price returned back to the level of $38,175. In the stock market, investors refuse to buy shares that have fallen in price against the backdrop of persisting geopolitical problems and in anticipation of a tightening of the monetary policy of the US Federal Reserve. They are now taking a wait-and-see attitude before important events.
On May 4, the US regulator will announce its interest rate decision. It is expected to rise by 50 basis points to 1%. The market has priced in the May increase in rates, so the reaction of market participants to J. Powell's speech is important. It depends on it whether bitcoin collapses or returns to the level of 40 thousand. If the daily candle closes above 41 thousand after the FOMC meeting, this will be a signal for a further recovery of the BTC/USDt pair. If the S&P500 and Nasdaq collapse after Powell's speech, then buyers will have to retreat to the level of $34,800 - support on the daily time frame in the form of a trend line. The line is drawn through the lows L28805 of 06/22/21 and L32917 of 01/24/22.
In the early morning, the BTC/USDt pair fell to the trend line $37386, which was drawn at the lows of L32917 from 01/24/22 and L34322 from 02/24/22. Buyers are nervous ahead of tomorrow's open, trying to protect the lower boundary of the A-A channel. The technical picture indicates an advantage in the direction of sellers. I don’t even know if the buyers will be able to fight back and hold the defense until May 4th. Powell is also in a difficult situation. He needs to fight inflation and prevent the US economy from driving the country into recession. And as we know from the latest Q1 US GDP report, she's already got one foot there.
Daily TF. bitcoin has remained trading in a wide range since the beginning of the year. Interest in it from different categories of investors has noticeably decreased. Including it in arbitrage trades has resulted in a high correlation with stock indices. Now it is an ordinary speculative asset. It becomes difficult to drag new investors into the market with the tightening of regulation of cryptocurrencies. Inflation is breaking records. Geopolitical risks are growing like a snowball. The future of cryptocurrencies is not visible because of the fog. Let's see what law will be adopted in Russia. He doesn't make me happy. But something is better than nothing.