Bitcoin consolidates above 61,000 and altcoins continue to show weakness
Today's market analysis on behalf of Samer Hasn Market Analyst and part of the Research Team at XS.com
May 13, 2024 (Investorideas.com Newswire) Bitcoin was able to consolidate again above the $62,000 level after the weak performance that the market witnessed about a week ago, which is the fourth correction trend since regaining these levels this year.
The weak performance of the crypto market in the absence of bullish catalysts comes in conjunction with the unstable regulatory environment in the United States.
While Bitcoin still maintains key support levels above $60,000, alternative crypto continue to record more weak performance, both in terms of prices and activity on the network.
Ethereum is still having difficulty consolidating above the $3,000 level, with user activity also declining, with the Total Locked Value (TVL) volume falling by 8% within a week on the Ethereum mainnet, according to DeFiLlama. The volume of user activity on the most widely used network ever reached less than 300 thousand ETH, which represents the lowest levels since last February and also represents the third lowest level this year. This in turn led to the lowest level of fee generated on the network this year at 608 ETH, the lowest level in four years.
Bitcoin spot ETFs in the United States did not help the market recover, with net outflows returning by $85 million on Friday and the net value of combined inflows since their launch last January falling to the lowest level since May 3, according to SoSoValue.
I believe that the crypto market may undergo further weakness, and that restoring the high levels that we witnessed earlier this year requires more incentives that are absent now, with there being nothing that buyers may rely on to push towards further gains.
On the other hand, we find that the US stock market enjoyed one of the best weeks last week, with optimism about the course of monetary policy for the rest of this year, with the possibility of achieving two interest rate cuts late this year, according to CME FedWatch Tools, in addition to the mostly encouraging corporates' earnings for the first quarter.
Therefore, the appetite for risks is still latent among investors, but they may be looking for what might push them to jump into the crypto market, and I believe that the widespread adoption of this technology is the most important absent motive so far.
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