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Daily Bitcoin and Crypto Analysis

Daily BTC Analysis

April 29, 2021
Bitcoin has traded to the lower end of the range today, with $54,240 seeing small moves on either side as price action remained subdued. The key support level at $53,130 will start to feel some heat if Bitcoin cannot muster the strength to return to $55,000.

Yesterday, the Fed provided zero surprises, with their commitment to purchase $80B of US Treasury Bonds and $40B of mortgage-backed securities every month. I'll try and put this into some context. Between now and the next halving, at these prices, there is only $50B of Bitcoin left to be mined. The monetary policy of the world's largest economy is helping to fill that demand quickly. With 1M Bitcoins until the supply halves again and with the Fed running inflation hot (and their printers, hotter still), you don't need to be able to send a rocket to Mars to work this one out.

Bitcoin's underperformance is a concern: The rotation from BTC in to Alts has picked up pace, supported by Bitcoin's behavior post the last new all-time high. This has driven the Bitcoin dominance index to yearly lows. The low point on the chart below, at 35.41, was during the ICO boom.

Today's market is certainly better quality than that of early 2018, and Alts are now enjoying the attention Bitcoin has brought them.

The real question is, if Bitcoin breaks lower and heads back to $50,000, will the rest of the crypto market take a bath or will the dominance index head back to record lows? This would certainly give kudos to both the non-Bitcoin projects and the market as a whole. However, are we at that stage of the cycle where Bitcoin can move in the opposite direction to that of ETH & co?

I guess we'll find out soon!

Technical Analysis

Bitcoin has retreated to support areas again today, with the daily high and low below that of yesterday. This is painting a mildly negative picture as we head into the weekend. The bulls will be hoping there will be no serious test of $53,130: So far, all efforts have fallen short of this critical level. The bears will be hoping Bitcoin's inability to rise will see further liquidations and will be aiming to take BTC back to $50,000.

Should support hold, we will see another advance to $54,240 and a further attempt to push Bitcoin back above the $56,600 level. All efforts have so far failed, leading me to presume that currently, support at $53,130 is about to feel the pressure of crypto's under performing asset.

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