Proactive Investors - Bitcoin (BTC) just kept its head above water in today’s early trades, changing hands at US$30,090 at the time of writing following a bullish Tuesday session that saw the BTC/USDT pair add over 3.3%.
Bitcoin’s stability above 30k will be contingent on a depreciating US dollar (i..e its common denominator) as the US Federal Reserve eyes up a looser monetary policy.
The Fed’s next rate call is expected on May 3, when another 25 bps hike is expected before the slow climb back to 0% commences.
Cryptocurrency market catalysts have generally been hard to predict in 2023, whether that’s the flurry of regulatory actions taken against the fiat on-ramps like Binance, Coinbase (NASDAQ:COIN) and Kraken, or the crisis engulfing crypto-adjacent banks Silvergate and Signature.
But if bitcoin’s forward performance sticks closer to macroeconomic catalysts in the form of Fed policy, it could bode well for the world’s largest cryptocurrency, particularly in the run-up to the next year’s halving event, which is historically a bullish moment for bitcoin.
Can bitcoin (BTC) stick above 30k? – Source: currency.com
For what it’s worth, the world’s largest cryptocurrency has shown its ability to stick above, or at least close to, critical support levels this year, such as the 28k range in March or the 22k point in January.
However, there has been much said about the lack of liquidity in the market, and much of the impressive 80% gains witnessed this year have been driven by bitcoin’s supposed safe-haven status in times of traditional market volatility.
With the latter issues subsiding, selling pressure isn’t out of the question.
In the meantime, bulls are weighing up a move above 31k, while US$29,880 appears to be the support line, per Binance’s order book.
Over to Ethereum (ETH), the second-largest cryptoasset added 1.4% on Tuesday, rounding the session off at US$2,100 before wiping these gains with a 1.4% move back to US$2,070 this morning.
ETH’s stellar post-Shanghai upgrade rally appears to have cooled off since peaking at US$2,141 on Sunday, though the ETH/USDT pair remains over 10% higher week on week, outflanking BTC/USDT’s flat performance.
Stretch the timeline out year to date, ETH is over 72% higher while bitcoin has rallied over 80%.
In the altcoin space
Cardano (ADA), Dogecoin (DOGE) and Avalanche (AVAX) remain the best weekly performers in the blue-chip altcoin space, all having added double digits to their respective market values.
Meanwhile, Ripple (XRP), Solana (SOL) and Tron (TRX) have underperformed with low-single-digit gains.
Looking further down the market, recently launched Ethereum Layer-2 solution Arbitrum (ARB) remains one of the top altcoin performers, with 40% added in the past seven days to bring its market capitalisation over US$2.1bn.
Optimism (OP), a similar project to Arbitrum, is also on a tear, adding 22% to bring its market value to a more modest US$859mln.
Arbitrum and Optimism are well positioned to capitalise on Ethereum’s recent Shanghai upgrade, which in turn increases their utility as Ethereum scaling solutions.
In the decentralised finance (DeFi) space, derivatives exchange Synthetix (SNX) and decentralised exchange dYdX added 27% and 17% respectively week on week.
Global crypto market map currently stands at US$1.27tn, while total value locked in the DeFi space inched above US$53bn after adding half a percent overnight.
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