Bitcoin bulls remain confident: 5 things to know about crypto this week

Author: William Suberg Source: coindesk Translation: Shan Ouba, Golden Finance

As the monthly close of May approaches, Bitcoin begins a new week with pressure on key resistance levels. BTC price action keeps bulls on their toes as old all-time highs struggle to convert into support levels. Can $69,000 be breached before June?

At the start of this week, institutional activity was suspended until May 28th in conjunction with Memorial Day in the United States.

However, macroeconomic catalysts will heat up afterwards, especially the release of US data, which, as always, will be a key focus for cryptocurrencies and risk assets. Meanwhile, Bitcoin faces its own challenges - consolidation below all-time highs has lasted for more than two months, and a solution to the status quo remains elusive. There are many optimistic BTC price predictions on the market, with some predictions including a six-digit target for BTC/USD in 2024, but concerns about a deeper correction remain.

With the market at a pivotal point, Cointelegraph takes a look at factors that could influence market movements as May ends.

BTC price seizes key $69,000 mark

Bitcoin experienced a classic weekend price action, breaking through $69,000 but falling back after the weekly close, according to data from Cointelegraph Markets Pro and TradingView. In doing so, it effectively closed the latest “gap” in CME Group’s bitcoin futures market, even as the U.S. market was closed for the Memorial Day holiday. “Basically weekend price action so far,” Daan Crypto Trades, a prominent trader, responded on X (formerly Twitter).

Nevertheless, the weekly close of around $68,500 is Bitcoin’s strongest weekly close since early April. Commenting on the latest development, trading resource Material Indicators stressed the need to convert $69,000 into solid support.

The post reads in part: “BTC’s green weekly close is accompanied by another failed attempt to convert $69,000 into support and a new trend premonition (downside) signal on the W chart,” referencing one of Material Indicators’ proprietary trading tools. “To me, a break above $71,250 would invalidate this signal.”

Meanwhile, the latest data from monitoring resource CoinGlass shows that key liquidity areas are accumulating around spot prices – leaving traders guessing which zone will be hit first.

As of May 27, $68,100 and $69,800 are the key levels of focus, with the latter sitting in the middle of the liquidity “cloud” of the order book.

"Bitcoin is designed to consolidate at these levels," Michaël van de Poppe, founder and CEO of trading firm MNTrading, summed up the day. "Where is the buy? Losing $66,000, I think we will test the range low and buy again. This is the level you are ready to buy."

Breakout or breakdown?

Where will Bitcoin go once it leaves its current range is a major focus for some market observers. Consensus is forming that Bitcoin will break out to the upside, but how high the market will go remains a topic of debate.

As Cointelegraph reported, calls for a $95,000 target in June and even $150,000 by the end of the year are being reinforced by their respective sources. Last week, the originator of the former prediction, well-known commentator BitQuant, suggested ignoring BTC price declines within the range. In another X post, he insisted: "The only thing I know for sure is that Bitcoin will reach $95,000."

Daan Crypto Trades also acknowledged that historical precedent is in favor of bulls - in previous BTC price cycles, long periods of consolidation below all-time highs led to bull breakouts. He calculated: "It has now been trading below its previous cycle high for about 11 weeks. It took about 4 weeks in 2017. It took about 13 weeks in 2013. Both led to massive expansions. I don't think BTC will slow down after leaving this price range this time."

However, some still believe that a larger correction is its base case. Among them is well-known trader Credible Crypto, who continues to focus on the approximately $60,000 area as the next possible target.

Going into the weekend, Material Indicators added that they are "fully prepared" for a return to $60,000. “There is not much liquidity-based sentiment supporting prices below $60,000 at this time, so expect to remain range-bound for an extended period of time,” it concluded.

Bitcoin Halving ‘Not Priced In’

For prominent traders and analysts, Bitcoin’s latest block subsidy halving is “not priced in.” Last week, in a YouTube video, Rekt Capital argued that despite the halving having completed last month, it remains an extremely important BTC price catalyst. He said Bitcoin is still in a “re-accumulation phase” post-halving — and such consolidation has historically lasted up to 160 days. “The longer we consolidate here, the better for Bitcoin,” the video said.

Nevertheless, Rekt Capital said that once these phases are complete, an upside continuation is “inevitable.” For the “most parabolic phase” of this cycle, a BTC price target of around $150,000 is appropriate, suggesting that short-term sideways BTC price action could take several weeks to resolve.

PCE data leads macro week

With US markets closed until May 28, Bitcoin lacked momentum for major external moves during Wall Street trading hours. There were no surprises during the Asian trading hours, so the focus turned to this weekend. By then, US macro data will be released again, led by the Producer Price Index (PCE) - the Federal Reserve's preferred inflation indicator. Sentiment on risk assets benefiting from accommodative Fed policy remains conservative. Rate cuts are not expected until September or later, and other inflation data remain mixed. Despite this, US stocks continue to hit record highs.

Trading resource The Kobeissi Letter wrote in its weekly macro diary entry on X: "A short but busy week." Commenting on the trends in stocks and Bitcoin, trading firm Mosaic Assets sees mixed conditions that are ultimately favorable for risk sentiment. "Daily momentum indicators such as the S&P 500's MACD and RSI have stretched out, suggesting a possible mean reversion to the downside," it wrote in the May 23 edition of its regular newsletter, "Market Mosaic."

Mosaic is similarly leaning toward a breakout to the upside for BTC/USD.

Risk asset classes are particularly sensitive to easing conditions, which is why I'm keeping a close eye on the action in Bitcoin and crypto mining stocks for further confirmation that the bull run is still ongoing. And note Bitcoin's two-month consolidation. The price has moved along the right side of the base over the past month and may be preparing to break out to new highs. A breakout would be further evidence that investor appetite for speculative assets remains strong. ”

BTC whales continue to be active

When it comes to “buying the dip,” some groups of Bitcoin investors did not hesitate below $69,000. This week the focus has been on Bitcoin whales, the largest of them, who have been particularly active as prices rallied and approached all-time highs.

Bitcoin whales are buying in unprecedented volumes, commented Vivek Sen, founder of Bitgrow Lab, alongside data from on-chain analytics platform CryptoQuant. ”

Data shows that the balance of active whale addresses in the past 24 hours is close to 500,000 BTC - easily setting a record high.