Bitcoin continued its downward trend in April on the first day of May and fell below $ 57,000.
As BTC continues to decline before the FOMC, investors are wondering about the reasons for this decline and whether it will continue.
At this point, analysts agree that investors' profit-taking was effective in the tremendous rise that took the BTC price to record levels above $ 70,000 in the decline that started in April, but warn investors that the decline may deepen further.
Speaking to Reuters, Fineqia research analyst Matteo Greco stated that the profit taking of many investor groups was effective in the decline in Bitcoin and altcoins and said:
“The recent downward trend can be attributed to increased profit-taking by investors who entered the market during the 2022 and 2023 crises, as well as by ETF investors who witnessed a significant price increase in their shares after entering the market in the first weeks of 2024.”
In addition, Greco said that the decrease in interest rate cut expectations following the data from the USA was also effective and that the view among investors that the FED will not be able to cut interest rates at all this year has intensified.
“Investors reacted to the interest rate situation and the consecutive large outflows in spot BTC ETFs,” Greco said.
“Bitcoin is at the Crossroads!”
Apart from Greco, FXPro senior market analyst Alex Kuptsikevich also evaluated the recent decline in Bitcoin.
Looking at the Bitcoin chart, Kuptsikevich stated that the decline in BTC has entered a new phase and, like Standard Chartered analysts, claimed that the decline in BTC may continue.
“I think May is not just a seasonal weakness for Bitcoin. It's a continuation of the declines that started in April, and the chart has brought $55,700, $51,000, and $52,000 into focus in the decline over the last few weeks.
The decline may continue to these levels. However, both the FOMC announcements today and Friday's monthly employment data may accelerate or reverse the downward trend. “
*This is not investment advice.
