Bitcoin took a sudden dive on May 10, dropping from $62,813 to $60,890 in just one hour. This sharp fall left many optimistic investors scrambling to sell their assets at a loss.
After weeks of uncertainty and skepticism from investors, experts now suggest that the crypto market is in a phase of consolidation. Bitcoin (BTC) has been on a downward trend since hitting its peak in March. The drop on Friday hinted that fewer investors are willing to buy during dips, especially with the Federal Reserve making strong statements and inflation expectations falling.
Alongside Bitcoin’s decline, there’s been a noticeable decrease in blockchain activity, with fewer Bitcoin transactions while ether (ETH), the second-largest cryptocurrency, experiences an increase in inflation. This period of consolidation is reminiscent of a similar stretch from April to September 2023, when Bitcoin traded between $25,000 and $30,000 for six months before its surge to new record highs.
Charles Edwards, founder of Capriole Investment, calls this the “bore you to death” phase, lasting anywhere from one to six months. It’s characterized by low volatility and Bitcoin staying within a narrow price range. Sentiment usually turns negative before this phase ends, signaling a potential change in direction.
Despite the recent setback, there’s been some cautious buying from traders, suggesting we might have hit a price bottom, according to insights from Santiment.
Analysts at Bitfinex predict this slowdown will continue into early summer, only easing when the Federal Reserve implements its balance sheet run-off curbs in June.
Michael van de Poppe believes the recent bearish movement could lead to more downward trends. He’s confident that Bitcoin is currently in its final accumulation phase, stressing the importance of Bitcoin closing above $61,000 to avoid a potential drop to the $52,000-$55,000 range.
Interestingly, the recent Bitcoin price drop coincided with a surge in the U.S. dollar. However, Bitcoin bounced back after the dollar weakened, suggesting a possible change in trend. Analysts cautiously predict that if Bitcoin remains strong and the dollar weakens further, we could see a bullish Q3 and Q4, offering hope for the cryptocurrency market’s future.
Also Check Out: Bitcoin Price Prediction: BTC Price To EXPLODE to $1 Million by 2030, Says Jack Dorsey
Is this a buying opportunity or a sign to stay on the sidelines? Let us know your investment strategy!
The crypto market pulses with activity as XRP tests key resistance levels, PEPE hints at…
As investors scan the market for their next big move, one token is beginning to…
Shiba Inu (SHIB), the wildly popular meme coin, has once again made a splash in…
Over the past week, Pepe Coin (PEPE) has seen a sharp rise of around 42%,…
Over the past week, a handful of altcoins broke away from the market consolidation, delivering…
After a long, painful stretch for altcoins, the market is finally showing signs of recovery.…
