Bitcoin and Cryptocurrency Markets This Week (May 23-29): The cryptocurrency market is finding it hard to jump out of the current slump.
Bitcoin and Cryptocurrency Markets This Week (May 23-29): The cryptocurrency market is finding it hard to jump out of the current slump. And it is not alone. In fact, other markets across the globe are also going through a tough bearish phase, amid fears of recession and rising inflation.
For the last many weeks, the price of Bitcoin (BTC), which dominates around 45% of the entire crypto market, has remained in the RED.
Interestingly, high correlation between global crypto and stock markets is becoming evident amid the current downturn.
“For 8 consecutive weeks, the Dow Jones Industrial Average has dropped; along with it major indexes have declined as well. As the S&P 500 fell, its high correlation with the crypto markets was evident. BTC ending the week at the $30,000 level also marks its 8th consecutive weekly close in the red,” Darshan Bathija, CEO and Co-Founder of Vauld, told FE Online.
Bitcoin price increased around 3 per cent in the last 24 hours. Over the last 10 days, BTC has traded flat, consolidating around $30,000 level. With investors apparently moving away from riskier assets under current inflationary circumstances, Bitcoin may find it hard to rise to its glory days.
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“Even though Bitcoin rose nearly 3% over the past 24 hours, it could not attempt to break above the US$30,000 level. BTC traded flat over the past week, struggling to move above its support,” Edul Patel Co-Founder and CEO of Mudrex said.
Analysts at WazirX Trade Desk said in a note that the monthly trend for BTC has broken below the ascending channel pattern.
“The next resistance for BTC is expected at $40,000 and an immediate support is expected at $24,000. The monthly RSI for Bitcoin is currently at 47 which is at the lowest point in over 2 years. The support for the RSI is at 43,” the note said.
Relative Strength Index (RSI) is basically a momentum indicator used in technical analysis of an asset. The RSI is used to measures the magnitude of recent price changes to understand the overbought or oversold conditions in the price of an asset.
When will BTC price recover?
Under current circumstances, crypto users may have to wait for the global stock markets to recover to see recovery in the crypto markets as well.
“With the stock markets registering new lows, it’s likely that the current bearish trend will continue,” said Bathija.
Patel said that an upward trend in BTC may be seen if it break above the $32,000 level this week.
“Due to the increased market uncertainty after the interest rates hike, investors are moving away from riskier assets. If BTC can break its initial resistance level at US$31,000 and US$32,000 this week, we may see an upward trend,” he said.
(Cryptos including Bitcoin and other virtual digital assets are unregulated in India. They are considered extremely risky for investment. Please consult your financial advisor before making any investment decision)