Bitcoin hit a new monthly low on April 4 as rumors about the Binance exchange spooked a fragile market.
BTC 1-hour price chart | Source: Transaction View
Bitcoin price returns to $28,000 after weekly low
Data from TradingView shows BTC falling to $27,240. The lowest level since March 28 follows news that Binance CEO Changpeng “CZ” Zhao has been investigated by U.S. regulators and is currently wanted by Interpol.
These claims stemmed from an accidentally leaked tweet from Cobie’s private Twitter account, but the apparent lack of evidence should lead to a market rally.
Binance Chief Strategy Officer Comment:
“It appears that Cobie’s market panic was nothing more than vandalism or an illegal market manipulation tactic. If this turns out to be true, it would imply that senior law enforcement officers committed multiple felonies, including violating insider trading rules.”
Bitcoin Now Exhibits “Classic” Behavior michael van der pop – Founder and CEO of Number Eight Trading Company.
Van de Poppe also referred to the macroeconomic environment, particularly the possibility that the Federal Reserve (Fed) will end its policy of raising interest rates.
“The trend is still up because we are relieved that the rate hike is over. We will likely see Bitcoin continue to rise to $40,000, but if we test $25,000 first, I will buy.”
A subsequent tweet said the local lows had been wiped out by BTC, targeting $30,000.
trough sweeping #bitcoin.
Grinding upwards, as long as $27,900 holds, I expect prices to continue higher and possibly $30,000. pic.twitter.com/dY89M95LLF
– Michael van de Poppe (@CryptoMichNL) April 4, 2023
The same optimism prevails in the market, with trading resource Stockmoney Lizard predicting $30,000 after a “short correction”.
Short correction, then 30k pic.twitter.com/vWf6PqHZie
— Stockmoney Lizard (@StockmoneyL) April 4, 2023
Keeping an eye on the balance (EQ) of the current range of $27,700, cryptocurrency trader Tony is also bullish.
“Keep EQ like a champion level. No short hurdles unless it’s tucked in firmly below it, but it’s still in the upper half of the range right now.”
source: Crypto Tony
Hidden US recession?
Changes are also taking place on the macro front, with the Organization of the Petroleum Exporting Countries announcing production cuts over the weekend, along with 10 other producers, and weak U.S. economic data weighing on the greenback.
At press time, the US Dollar Index (DXY) was below the 102 mark.
US Dollar Index (DXY) 1-day candlestick chart | Source: TradingView
For trading firm QCP Capital, a recession looms.According to the version renew 4/4 market:
“Dollar and bond yields (both BTC drivers) plunged after the production ISM – showing the biggest declines since April 2020 (mid-pandemic). We expect weaker US data this week, Thereby reinforcing the recession narrative. After much thought about which might be better, we believe this is really going to be a long-term thing.”
While bitcoin may benefit from disruptions, such as last month’s banking crisis, its role as a safe haven during a recession remains “unproven.”
“If the Fed acts quickly during a recession, as it did during last month’s banking crisis, we expect BTC to return to the moon.
However, in a recession accompanied by inflation, if the Fed feels unable to cut interest rates before inflation hits its target again, will BTC follow risk assets down? This has yet to be tracked. While BTC has not proven to be an inflation hedge, it is certainly the strongest beta currency hedge available. “
As previously reported, the initial rise in oil prices was seen as risking a return to inflation, allowing the Fed to keep raising rates.
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As reported by Cointelegraph
