Bitcoin has experienced a significant drop of more than 15% from its mid-March peak, reaching a ten-day low of under $62,000 on Monday morning. Analysts have noted that the halving is over, but bitcoin continues to display red candles, indicating a period of correction. The current sentiment is a mix of uncertainty and pessimism, with concerns about geopolitical tensions and macroeconomic factors influencing market behavior.
Analysts have identified key support levels at $60K, $56K, and $52K, with each level becoming more likely to be tested if the one above it is breached. The short-term outlook for May is cautiously optimistic, with a potential uptrend within the correction range. Market conditions are uncertain, and any negative news could push prices towards the $50K range. The potential for a breakout exists, provided that market conditions remain stable.
This week, the Federal Reserve is expected to announce its interest rate decision, and rates are likely to remain unchanged due to higher-than-expected inflation. This could further accelerate the market correction and potentially push Bitcoin below its immediate support level of $60K. Traders are advised to exercise caution, with some opting to stay out of the market until clearer trends emerge.
Despite the prevailing gloomy sentiment, Glassnode analyst “Checkmatey” has observed a positive trend among Bitcoin retail holders. Small accounts holding less than 1 BTC, referred to as “shrimp” accounts, are accumulating 12,200 coins per month based on Glassnode data. Corrections are viewed as healthy parts of market cycles, offering opportunities for investors to buy the dip. The duration and depth of the current correction remain uncertain, but market participants are advised to remain vigilant and monitor developments closely.
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