Bitcoin (BTC), the world’s largest digital currency by market capitalization has fueled a major suppression in the combined crypto market capitalization stemming from its bearish price slump. At the time of writing, Bitcoin is worth $28,502.95, down by 2.56 percent over the past 24 hours. While the Week-to-Date (WTD) growth remains positive above 4 percent, the current gloom is masking the propensity for growth this week and by extension, this month.
Despite trading below the psychologically important level at $30,000, Bitcoin has maintained a relatively promising resilience above the key support level at $28,000. As the representative asset in the emerging digital currency ecosystem, BTC is known to maintain a very close correlation with some core indices in the mainstream financial ecosystem.
Some of these indices include the S&P 500 Index and the Nasdaq 100 respectively. The sheer stability Bitcoin has experienced thus far can be attributed to its correlation with these indices amid promising performance reports from top tech giants in the United States including Meta Platforms, Apple Inc, and Amazon.com Inc to mention a few.
The collapse of some of the major banks in the United States also served as a pointer that helped shoot the correlation between BTC and Gold to a 2-year high. These assets became the haven for most investors as the uncertainty surrounding legacy banking grew.
While the industry appears to be regaining its balance with the news that JPMorgan Chase and Co is set to acquire First Republic Bank, some key events slated for the rest of this week can have an underlying impact on the price of the premier digital currency.
Bitcoin outlook amid expected economic data from around the world
Beginning on Tuesday, the 2nd of May, inflation data from the European Central Bank (ECB) will be released. A day after, the United States Federal Reserve is billed to unveil its recent interest rate decision.
Inflation has been slowing down following consistent efforts from these apex banks through targeted hikes. Despite this slowdown, the inflation is still higher than the projected range across all key regions. With continuous rate hikes, the fear of financial contraction may grow, fueling more Silicon Valley Bank and Silvergate Bank-like crises.
The expected decisions will have a major underlying influence on how the market investors embrace risk assets like Bitcoin. Irrespective of the position of the Central Banks on rate hikes, Bitcoin is billed to benefit in the long run. Should there be an easing, it will signify the start of major cash flowing into the industry.
While the events in view can help fuel a renewed Bitcoin rally, Bitcoin is poised to close the second quarter around $40,000 rather than some of the overly optimistic bogus projections pegged at around $100,000.