May has the potential to bring about significant events that could greatly impact the future of Bitcoin and the overall cryptocurrency market. Decisions made by regulatory bodies and upcoming economic indicators are expected to shape the dynamics of the market in a noticeable way.
The month kicks off with an important meeting featuring Federal Reserve Chairman Jerome Powell, which will be followed by a series of significant events. Powell’s press conference has been garnering attention due to recent economic data that reveals a decline in confidence in an economy where wage pressures persist.
In recent weeks, Powell has emphasized the challenges of controlling inflation and has highlighted the strong outlook of the employment market, which continues to influence expectations regarding monetary policy.
Another highly anticipated event is the release of the Consumer Price Index (CPI) for April from the US on May 15. This will have implications for the future of cryptocurrencies. Following this event, the United States Securities and Exchange Commission (SEC) is expected to make a decision on May 23 regarding Spot Ethereum ETFs.
The outcome of these events could potentially lead to significant changes in market liquidity and volatility, either positive or negative. The SEC’s response to VanEck’s application for an Ethereum spot ETF on May 23 and to a Bitcoin spot option ETF application on May 29 could serve as triggers for market movement.
The recent statements by officials from the Federal Reserve suggest that the high-interest environment may persist for a longer period than initially expected, and this is already starting to impact the cryptocurrency market. Bitcoin, for instance, experienced a sharp decline in price, dropping over 6% in just 24 hours to $56,757, reaching one of its lowest levels in recent times. This decline resulted in significant liquidations affecting 106,104 investors and totaling over $394.82 million, as reported by Coinglass.
Renowned financial analyst Peter Brandt has conducted a review of market models and his analysis suggests that Bitcoin may face further declines before a potential recovery. It is possible that the cryptocurrency may retreat to the $40,000 region during this correction phase.
It is important to note that the information provided in this article should not be considered as investment advice. Investors should be aware of the high volatility and risk associated with cryptocurrencies and should conduct their own research.
