On Wednesday, the Bitcoin price is moving sideways. At the time of writing the article, BTC is hovering at $27,687.
According to CoinMarketCap, Bitcoin reached a low of $27,375 and a high of $27,824 over the past 24 hours.
Yesterday, the crypto market maintained strong bullish sentiment. Thus, at the end of Tuesday's trading session, the BTC price gained 0.25% and closed at $27,616. The market leader's optimism was also picked up by leading cryptocurrencies from the top 10 by capitalization, which also rose in price.
At the same time, Bitcoin lost more than $1,000 on Monday, falling below the important psychological level of $28,000. The key reason for the pressure on Bitcoin was rumors about the possible collapse of one of the largest cryptocurrency exchanges in the world, Binance. For example, on May 8, users withdrew more than $5.6 billion from the exchange, forcing Binance to suspend coin withdrawals twice amid network overload.
In addition, the media reported that the US Justice Department launched an investigation against Binance in connection with suspicions of violations of its sanctions against Russia.
On Tuesday, the key reason for Bitcoin's transition to growth was the strengthening of US stock market indices the day before. Thus, at the end of Monday, the S&P 500 stock index rose by 0.05%, while the NASDAQ Composite increased by 0.18%.
Economists have recently noted a decrease in the level of correlation between crypto and stock markets in the coming year against the background of the current flat movement of the BTC price.
In late February, this was reported by analysts from the US investment company Bernstein. In the past month, the correlation between Bitcoin and the NASDAQ Composite index collapsed to 0.58 from 0.94.
According to Bernstein, the crypto market has recently been balancing between bullish and bearish trends, waiting for further catalysts. At the same time, its sensitivity to important news and events in the financial world has decreased significantly.
At the beginning of 2022, analysts often emphasized a high level of correlation between the US stock market and the crypto market amid tense expectations of both the consequences of the geopolitical conflict in Eastern Europe and the further steps of the US Federal Reserve. Thus, in the middle of last year, the investment company Arcane Research stated that the correlation between BTC and tech stocks reached the highest level since July 2020.
At the same time, TradingView's economists stated that the correlation of the cryptocurrency market with the US stock market in the fourth quarter of 2022 was 70%.
Altcoin market
On Wednesday, Ethereum was trading sideways. At the time of writing the article, the altcoin is trading at $1,844. By the end of Tuesday, the cryptocurrency rose by 0.90% and closed at $1,847.
As for the cryptocurrencies from the top 10 by market cap, the best crypto was XRP, adding 1.58%, and the top loser was Polygon, which dropped by 2.56%.
In the past week among cryptocurrencies from the top 10, all coins were steadily losing value. Polygon lost 9.41% and became the worst-performing token.
According to CoinGecko, the world's largest aggregator of data on virtual assets, in the last 24 hours among the top 100 most capitalized digital assets, the first place on the list of rise went to Bitcoin SV token (+39.57%), while in the list of fall - Render Token (-7.76%).
At the end of last week, in the first hundred of the strongest cryptocurrencies, the best results were shown by the digital asset Pepe (+111.39%), while the worst was Sui (-73.57%).
According to CoinGecko, as of Wednesday morning, the total market capitalization of cryptocurrencies was above the important key level of $1 trillion and amounted to $1.109 trillion. During the past 24 hours, this indicator fell by 0.34%.
Since reaching its peak above $3 trillion in 2021, cryptocurrency market capitalization has lost nearly $2 trillion.
Forecasts by crypto experts
As for forecasts about Bitcoin's near-term future, most of them assume a positive scenario and point to the digital coin's stability.
Thus, crypto experts say that in the short term, the BTC price may move in the range of $27,000-$28,500. Experts believe that Bitcoin has a good chance to reverse the bearish trend but the cryptocurrency will need strong catalysts, which are currently absent in the markets.
YouTube analyst Jason Pizzino is even more positive. He says that even unfavorable events in the market will not be able to stop the BTC rally, and soon the coin will be in the range of $32,000-$42,000.
Arthur Hayes, the founder of the cryptocurrency exchange BitMEX, holds a similar opinion and is confident that no matter what financial path the Federal Reserve and US authorities take, BTC will rise to new all-time highs. According to Hayes, this will happen both when inflation is high and the key interest rate goes up, and when inflation goes down and interest rates go down.
