Bitcoin undecided on a scenario for May

Bitcoin is down 3% over the past week, ending at around $38,000. Ethereum fell 4.4%, while the other top 10 altcoins fell 4% (Binance Coin) to 14.7% (XRP). Total crypto market capitalization, according to CoinGecko, fell 4.6% on the week to $1.75 trillion.

The Bitcoin Dominance Index rose one percentage point to 42.2% over the same period due to weakness in altcoins. For the week, the Cryptocurrency Fear and Greed Index fell 2 points to 22 (“extreme fear”).

The index rose to 28 points on Monday and moved to “fear” status. Bitcoin has fallen over the past four weeks amid weakening US equity indices. On Friday, shares of Amazon and Google suffered their biggest falls since 2008, dragging down the tech-heavy Nasdaq index. It lost 12.7% in April, its biggest drop since 2008.

Bitcoin fell 16.2% from April, offsetting the rise of the previous two months and below seasonal trends. This is the worst performance for any given month of the year in trading history since 2011. In terms of seasonality, May is considered a relative success for BTC.

Over the past 11 years, bitcoin has ended the month up seven times and down four times. The average increase was 27% and the average decrease 16%. Under these scenarios, the estimated average range for BTC at the end of May is between $32,000 and $48,000.

A more local view of the dynamics of the first cryptocurrency indicates a continued struggle around the $38,000 mark. This struggle will decide which of the levels above the price will be closest to at the end of the month. The management of the Swiss National Bank (SNB) considers it inadvisable to invest in bitcoin and keep it in reserve for the regulator. The US Department of Labor has raised concerns about a move by US investment firm Fidelity to allow its customers to put a portion of retirement accounts into bitcoin.

This article was written by Alex Kuptsikevich, Senior Market Analyst at FxPro.


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