Analysis of Bitcoin’s Price Action and Market Sentiment by Matteo Greco, Research Analyst at Fineqia International
Bitcoin (BTC) experienced a turbulent week, ending at approximately $65,650 after a 5.3% decline from the previous week’s closing value. The week saw significant volatility, especially over the weekend, following a period of stability earlier in the week.
The weekend’s price drop was attributed to geopolitical tensions in the Middle East, with market sentiment improving after news of a temporary halt in hostilities. Attention is also focused on the upcoming halving scheduled for April 19th-20th, with historical trends suggesting a potential uptrend in the months following the event.
Despite the downturn, trading volumes remained strong, with BTC Spot ETFs recording a weekly trading volume of approximately $16.2 billion. BTC’s dominance metric, which measures its market capitalization compared to the entire digital assets market, is currently at 55.3%, the highest level since April 2021.
On the macroeconomic front, recent US inflation data exceeding expectations has led to a shift in rate cut projections for 2024. Initially, expectations were for significant rate cuts, but now projections anticipate smaller cuts throughout the year.
The presence of inflation levels surpassing central banks’ targets could lead to a prolonged period of tighter monetary policy, posing short-term challenges for risk-on assets. Investors may need to realign their portfolios in response to revised mid-term expectations influenced by the latest financial indicators.
