Current trend

Last week, the BTC/USD pair had ambiguous dynamics: initially, the quotes fell to the area of 56480.00, but then regained their lost positions and are now around 65400.00.

The decrease was due to the weakening of investor interest in digital assets after halving in the Bitcoin network and the outflow of capital from ETF–based funds: in the period from April 22 to April 26, it amounted to 328.0 million dollars, and from April 29 to May 1 - about 777.0 million dollars. Nevertheless, in the middle of the week, the cryptocurrency market was supported by monetary factors. At first, the head of the US Federal Reserve, Jerome Powell, said that an increase in the cost of borrowing soon is still unlikely, although inflation data from the beginning of the year caused officials to have more and more doubts about the possibility of consumer prices to reach the target level of 2.0%. After that, the April labor market data published on Friday gave investors hope for a significant reduction in interest rates this year: the unemployment rate in the United States increased to 3.9%, employment slowed down to 175.0 thousand, and the average hourly wage growth slowed from 4.1% to 3.9%. Thus, the labor market is showing clear signs of cooling, which, along with a slowdown in gross domestic product (GDP) to 1.6% instead of the expected 2.5%, creates prerequisites for easing monetary policy and weakening the US dollar against alternative assets, including digital ones.

Despite the current recovery of their positions by the main cryptocurrencies, JPMorgan Chase & Co. experts note that retail investors' interest in tokens is falling, and the position of American regulators remains tough, therefore, in the medium term, pressure on BTC and other leading assets will remain.

Support and resistance

Technically, the price is within the medium-term downward channel. Last week, the quotes tested its lower limit, but could not consolidate below it. Currently, the trading instrument is close to the level of 65625.00 (Murrey level [5/8]), the breakout of which will open the possibility for continued growth to 68750.00 (Murrey level [6/8]) and 71875.00 (Murrey level [7/8], the upper border of the descending channel). Otherwise, the decline will resume to 59375.00 (Murrey level [3/8]) and 56250.00 (Murrey level [2/8]).

Technical indicators do not give a clear signal: Bollinger Bands unfold horizontally after a decline, MACD is stable in the negative zone, while Stochastic enters the overbought zone and may reverse down.

Resistance levels: 65625.00, 68750.00, 71875.00.

Support levels: 62500.00, 59375.00, 56250.00.

Trading tips

Short positions should be opened below the 62500.00 mark or after the price reversal around 68750.00 with targets of 59375.00, 56250.00 and stop-losses of 64300.00 and 71000.00. Implementation period: 5–7 days.