May 3 2024: Bitcoin’s price saw a rise on Friday, finding relief in a sharp decline in the dollar. However, the cryptocurrency’s outlook remains clouded due to expectations of high U.S. interest rates.
Traders were cautious about cryptocurrencies leading up to the release of key nonfarm payrolls data, which would impact rate expectations. Bitcoin saw a 3.7% increase in the last 24 hours, reaching $59,529.4 by 01:07 ET (05:07 GMT). Despite this, it remains near bear market levels after a significant drop from its March record high.
The recent drop in the dollar provided temporary relief for Bitcoin and other cryptocurrencies. However, they are still on track for weekly losses, with Bitcoin down 6.2% for the week. Traders’ cautious stance towards crypto is reinforced by the anticipation of prolonged high U.S. interest rates.
Bitcoin investment products, particularly spot exchange-traded funds, have seen three consecutive weeks of declines. The initial excitement following the approval of ETFs in March has faded, contributing to Bitcoin’s recent trading range between $60,000 to $70,000, which it broke below this week.
Altcoins also saw some recovery, with Ethereum rising 2.6% to $2,999.45, and Solana and XRP posting gains of 8% and 1.7%, respectively. However, their weekly performance remained subdued due to apprehensions about U.S. interest rates.
The upcoming nonfarm payrolls data is expected to show continued strength in the U.S. labor market, potentially giving the Federal Reserve more reason to maintain high rates. The Fed recently indicated no immediate plans to lower rates, citing persistent U.S. inflation signals.
