The BTC trend is "extremely boring", and the rebound may need to wait until the second half of the year

As Bitcoin continues to consolidate between $60,000 and $65,000, the encryption market ended the week sluggishly.

The University of Michigan’s better-than-expected May consumer report, with broader consumer indicators hitting their lowest level in six months, revealed that inflation expectations for the year ahead rose to 3.5% from 3.2%, still at high levels compared to pre-pandemic values. The Fed appears to be in a “dilemma” between adapting to an economic slowdown and battling rising inflation expectations. After the release of the report, risk assets smoothed out the pump.

Bitcoin experienced a sharp sell-off near midday on Friday, falling from a low of $63,000 to a low of $60,155 and has been consolidating below $61,000 ever since.

At the time of writing, BTC is trading at $60500, down 3.45% fall 24 hours.

market capitalization the top 200 alts fall long pump, only 20 alts pump. Akash Network (AKT) was the best performer, pump 14.6% above and trading at $5.93, followed by Jito (JTO) pump 6.4% and ZetaChain (ZETA) pump 5.3%. ssv.network (SSV) had the largest fall with a fall of 17.5%, cat in a dogs world (MEW) fall 11.6%, and AIOZ Network (AIOZ) fall 8.2%.

The overall market capitalization of Crypto Assets is currently $2.25 trillion, with Bitcoin dominating 53.2%.

Equities pump fall mixed, with the Dow Jones trading pump for the eighth straight session, closing pump 0.32%, while the S&P pump 0.16% and the Nasdaq was flat.

Bitcoin is in a ‘boring to death’ phase

Charles Edwards, founder of Capriole Investment, a Crypto Assets Hedging fund, said in the X platform: “Bitcoin is in the ‘boring to death’ stage”.

He explained that this consolidation period is likely to last from one to six months, during which the Bitcoin will Fluctuation in a low-Fluctuation range until market participants lose patience. He added that market sentiment will be the most negative until the end of the consolidation.

“When you’re tired enough of sideways swings, common symptoms will include thinking that the halving has been priced in, that the bull market is over, and selling to buy stocks at the bottom, and that sentiment and shorts will peak before the big pump,” Edwards said. ”

Chris Yin, CEO and co-founder of Plume Network, said: "The last few weeks have been between around 60,000 and 64,000, and the overall trend seems to be towards downward consolidation. Therefore, in the short term, we will see, but Bitcoin is likely to continue to slide for some time, which is natural. After Bitcoin Halving and months of price pump, there will naturally be some cooling, especially if the Fed hasn’t cut rates aggressively. ”

Yin said excessive expectations for rate cuts meant that “the market was a little bit ahead of reality, so naturally there would be some pullbacks.” In addition, global macro instability is also a problem, “in the context of increasing global conflicts”, which leads to more panic and wait-and-see. Not to mention that all the wells have taken note of SEC Chairman Gensler’s continued enforcement actions in the Crypto Assets space."

Chris Yin said that what people really need to focus on is the macro environment.

First, investors are waiting for improving economic data and signals of interest rate cuts, US inflation has been stubbornly high, so Jerome Powell will cut Intrerest Rate sharply when inflation cools. Once this happens, there will be a reversal in the relevant indicator – BTC ETF inflow data improves, and traders will feel comfortable injecting Liquidity again, driving BTC price pump upwards.

At the same time, the upcoming US election in November will be an important indicator because Trump has been saying that he is positive about Crypto Assets, and the Biden administration is clearly very negative about this asset class, Yin said: “If Trump wins, risk asset prices are Favourable Information, and if Biden wins, things tend to be conservative.” ”

“The bottom may be near”

Analyst firm Santiment says the bottom may be near.

Santiment said on platform X on Friday that “traders are showing interest in 'buying the dips for Bitcoin’s latest pullback.” “In general, the lack of confidence in the crowd is a strong signal that the price is close to the bottom.”

Bitfinex analysts noted in a note on Friday that Bitcoin’s recent weakness comes against the backdrop of a surging dollar and waning expectations of interest rate cuts, and said the lull could continue into early summer.

“We expect the market to remain uncertain in the near term in a low Fluctuation environment until the actual tapering of QT (quantitative tightening) in June,” the analysts said. ”

The Fed announced plans to curb the pace of balance sheet reduction starting next month, which will affect the liquidity of the US dollar, in favor of risk assets such as Crypto Assets, which are sensitive to the global liquidity environment. “The continued strength of Bitcoin and the recovery of range lows, as well as the simultaneous weakness of the US dollar, following the FOMC and job market data, is a new sign that will prepare us for a very bullish look for Bitcoin in Q3-Q4,” Bitfinex reported.