Over the past few days, Bitcoin and Ethereum have dropped and rebounded in the cryptocurrency markets. The market’s reaction to these changes and their impact on cryptocurrency’s future are unknown.
The cryptocurrency markets saw a mini-crash yesterday, which was followed by a modest recovery today.
This dynamic started two days ago, and it was by no means unimportant. The last three days’ Bitcoin and Ethereum price movements show it.
A current snapshot of the cryptocurrency markets shows that Ethereum has recovered from yesterday’s fall
Everything started on April 25, when the minor ETH bleeding from staking came to an end.
This hemorrhage, though it was quite slight, started a few days after ETH was freed from staking as a result of the Shapella upgrade on April 12.
In fact, the price of Ethereum dropped from $2,100 to $1,970 on April 19 when Binance enabled staked ETH withdrawals. It subsequently dropped once more on April 24 to slightly around $1,800.
On the 25th, there was a change of direction, and the price went back to $1,870.
Yesterday, however, the price soared to $1,960 in just four and a half hours on the wave of the modest rebound on April 25, but this quick and considerable gain turned out to be unsustainable.
In reality, the price of ETH dropped by around 8% in the following 70 minutes, briefly falling below $1,800.
Because this decrease was too sharp and sudden, the price rebounded to around $1,900.
This particular dynamic of inflated growth, excessive mini-crash, and subsequent rebound appears to have concluded at this point.
Mini-crash in Bitcoin: The cryptocurrency queen appears to be gaining ground today
To be honest, when looking at the price of Bitcoin, this dynamic is much more apparent.
It is important to note that up until April 24 the price trend of ETH was probably what drove the cryptocurrency markets, but following the recovery on April 25, it appears that the price trend of BTC is once again in control.
Before the recovery on April 25, Bitcoin was trading for less than $27,500. After that recovery, it was back above $28,300, but yesterday, it soared to over $30,000 in just four hours.
This threshold is crucial because it determined the 2023 annual high in mid-April and it defined the brief period of lateralization in May 2022 following the implosion of the Terra/Luna ecosystem, prior to the collapse caused by the Celsius bankruptcy.
After four days below $28,000, a rapid comeback above $30,000 seemed barely sustainable, and yesterday the price quickly fell below $27,300 with an unexpected mini-collapse within just 50 minutes.
But yesterday’s mini-crash appeared to be excessive, just as the ascent beyond $30,000 appeared to be too quick and excessive.
As a result, there was a rebound that pushed the price back to about $29,000, which is about where it should be right now.
Because of Ethereum’s slump as a result of sales of ETH removed from staking, the price had dropped down to just about $27,000 after reaching annual highs well above $30,000 in mid-April.
This period came to an end on April 25 with a comeback that briefly sparked an excess of enthusiasm that briefly increased Bitcoin’s price to $30,000 yesterday. The extreme enthusiasm caused a mini-collapse that subsided after a few hours.
What to anticipate during the next several days
May’s first week could be crucial.
The first is that the ETH that has been staked on Lido will likewise be unlocked, even if it appears that the decrease in Ethereum’s value caused by the unlocking of staked ETH is now in the past.
The Fed will announce its new rate decision on May 3; however, the market has already largely priced in an additional 25 basis point rise.
The market is frequently affected by news conference statements rather than the actual rate hike, though. Additionally, it is theoretically plausible that the Fed will always decide not to hike them.
Finally, if Bitcoin’s price trajectory in 2023 follows that of 2019, a brief bull run in early May might boost the price back up to $35,000.
Thus, the current stage appears to be a wait-and-see time for what will happen in early May, with an attempt to regain the mid-month yearly records.
In other words, a sort of reverse bounce following the losses after 19 April may be in progress.
Yesterday, it appeared that this reverse bounce was over, but the mini-collapse revealed that it is still too early for a steady comeback above $30,000.
