- At this point in time, the market looks as if it's hanging around the $66,000 level.
- Keep in mind that the 50-day EMA and the 200-day EMA indicators are both very negative and I do think it's probably only a matter of time before we see more selling pressure every time, we do rally.
The $72,000 level is an area that I think a lot of people will watch closely as it has been a ceiling as of late and if we were to break above there it could send a bit of a short squeeze. Ultimately, you have to watch the $60,000 level underneath due to the fact that it is a large psychologically significant figure and a floor in the market.
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Market Uncertainty and Mining Pressures
The volatility has followed the Trump administration since the inauguration as it initially appeared that there were going to be major changes to crypto which could help lift Bitcoin. Since then, the market has seen increased uncertainty when it comes to crypto adoption, getting investors to rotate out of it.
There are concerns with the price causing Bitcoin miners to operate at a loss as the average production cost is estimated at $87,000. As long as that continues to be the case, this forces miners to sell their reserves to cover cost, adding constant selling pressure.
The government of UAE is holding its mined coins, but other nations like Bhutan and some other outliers in Asia have begun to systematically sell millions in Bitcoin since the start of the year. The month of May will bring a 24/7 crypto futures contract coming out and that could be a major structural shift as well.
I think there's just far too much in the way of uncertainty to get this market rallying. Longer term, there are bigger concerns about whether or not there is ever going to be any type of utility to Bitcoin, but as things stand right now, this looks like a fade the rallying environment.
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