The precious metal is stealing the spotlight as Bitcoin languishes below $40,000 after the Easter weekend.
Bitcoin (BTC) and most major altcoins have been relatively quiet over the holiday period since Good Friday. This suggests that cryptocurrency traders are not initiating big bets during the period that US stock markets are closed. The reason could be the close correlation between the price of Bitcoin and the S&P 500, as well as the uncertainty about the behavior of the stock market in the coming week.
While some analysts expect short-term weakness, others believe the Bitcoin price could be in a consolidation phase, with much of its four-year halving rally yet to come. Josh Olszewicz, head of research at alternative asset management firm Valkyrie, said that, “it’s interesting. Maybe we never capped the blowout…because it hasn’t happened yet.”
Bitcoin (BTC) is nearing a relief bounce but is still at risk of falling as low as $30,000 before May, a new analysis warned on April 18.
Data from Cointelegraph Markets Pro and TradingView showed the BTC/USD pair hovering around $39,000 on April 18, as bearish forecasts for the pair increased.
After losing support at $40,000 overnight on April 18, Bitcoin faced tight liquidity in the absence of US and European stock trading, thanks to the Easter weekend.
The Drop to $30,000 is April’s “Risk”
For popular Crypto Ed trader, a short-term pullback should bottom at $37,500 before a bounce occurs.
“First we have to get back to $40,000, if we do that it will certainly give the market a bullish push,” he said in his latest YouTube update.
Should that happen, the $43,000 level could be the local high, but going forward, the picture looks bleak. Using Elliott Wave analysis, Crypto Ed predicted a repeat of recent moves lower interspersed with a brief relief bounce. The target, he concluded, was $30,000.
“That’s the risk for the next, say, two weeks,” he added.
The popular Bitcoin Jack Twitter account also called for the coming weeks to be a time of reckoning for long-term price action: “Room for a squeeze up but then heading to the monthly level below in due time is where my thinking is at. Guessing early May to decide major trend into summer time.”
As Cointelegraph previously reported, $30,000 as a target for May or June is nothing new.
Gold Strikes Out as Cryptocurrency Correlation Declines
Even though Bitcoin is under pressure, there was no sense of pain for the safe haven of gold on April 18.
After rallying for the entire past week, the XAU/USD pair approached the $2,000 mark again, approaching the $2 resistance level before pulling back around $1,990.
However, the pair traded at its highest level since March 11, turning its back on the US dollar’s own strength.
“A 50-day correlation coefficient for Bitcoin and gold is around minus 0.4, the lowest since 2018,” noted journalist Colin Wu on the implications of divergent price behavior for gold and Bitcoin.
“For now, Bitcoin remains closely correlated to the Nasdaq 100 Index. The Nasdaq 100 is down around 15% this year, while Bitcoin has shed 16%.”
By Audy Castaneda
