May 13 2024: The weakening of the dollar on the day provided some relief to the crypto markets Bitcoin surged by 2.5% over the past 24 hours, reaching $62,639.1 by 08:16 ET (12:16 GMT), recovering from a near breach of the $60,000 support level just hours earlier.
Over the past seven days, the world’s largest cryptocurrency experienced a 2% decline, influenced by concerns surrounding potential regulatory actions in the U.S. crypto market. Additionally, ongoing capital outflows from crypto investment products, particularly spot Bitcoin exchange-traded funds (ETFs), contributed to the subdued sentiment.
Dollar Movement Ahead of US Inflation Data: The U.S. dollar, which has been a key factor affecting Bitcoin and crypto prices recently, showed a slight decline on Monday in anticipation of the upcoming consumer price index (CPI) report for April.
Tuesday will witness the release of producer price index data, followed by the more significant consumer price index reading on Wednesday.
Any indications of persistent inflation could dampen hopes for early interest rate cuts by the Federal Reserve, a scenario that is typically unfavorable for crypto markets.
Fed Comments and Market Sentiment: This week also brings more commentary from Federal Reserve officials following recent skepticism about expectations for immediate rate cuts.
Comments from Presidential candidate Donald Trump, supporting the crypto industry and criticizing the Biden administration’s stance, provided limited support to crypto prices.
Analyst Insights and Market Outlook: FxPro trader Alex Kuptsikevich warned of a potential panic sell-off if Bitcoin fails to maintain the $60,000 level in the near future. He highlighted the importance of surpassing $65,000 to shift market sentiment towards bullish territory.
Recent market trends have seen Bitcoin fluctuating between $60,000 and $70,000 since March, with the anticipated halving event in April not delivering the expected boost, leading to a ‘sell-the-news’ scenario.
Other Cryptocurrency Performance: In the broader cryptocurrency market, Ethereum gained 1% to reach $2,959.61, while XRP saw a 0.4% rise, and Solana experienced a 0.16% decline. Memecoins like Dogecoin witnessed marginal fluctuations, with a slight 0.1% decrease.
