Equities once again buoy the crypto market, but Ethereum is a cause for concern

Market overview

The crypto market capitalisation rose by 1.29% over the past 24 hours to $2.57 trillion, supported by the Nasdaq-100 and S&P 500 indices hitting impressive new all-time highs. Furthermore, the strengthening of the Japanese yen caused the dollar index to fall, lowering the benchmark. The top performers were Zcash (+5%), Dash (+4.8%) and Aptos (+3.4%). The underperformers among the top coins were Theta (−1%), Cosmos (−1.4%) and NEAR (−1.4%).

Bitcoin is once again attempting to climb above $77K, having found support from buyers during the dip to $75K. The shakeout of buyer positions proved to be quicker than might have been expected. However, it is too early to speak of bullish dominance until the leading cryptocurrency has confidently broken through the final resistance at $80K, which would open the way to $84K–$85K.

Ethereum is setting a more cautious tone. Over the past three weeks, the price has retreated after touching the 200-week moving average from below, which is an important signal of a bearish market prevailing across this asset and the whole altcoin market. However, the situation is balanced by ETH's strong rebound at the start of the year from the long-term support line of the uptrend, which runs through the lows of 2022 and 2024.

News background

Bitcoin rose by 12.2% in April to $76,500, marking its strongest growth in the last 12 months. Before this, in March, BTC showed a slight gain (+2%) following five months of decline.

From a seasonal perspective, May is considered a positive month for BTC. Over the past 15 years, Bitcoin has ended the month with gains on nine occasions and with losses on six. The average gain was 26.5%, while the average loss was 14.5%.

Bitcoin’s growth is being held back by market participants’ positions on the Deribit exchange, notes Bloomberg. Call options expiring in May and June, worth $1.5 billion, are concentrated around the $80K level. In such a situation, market makers are forced to sell the asset as its price rises to hedge their risk.

No fewer than 11 indicators are signalling the best buying opportunity in five years, points out MN Trading founder Michael van de Poppe. The last time the market saw a similar picture was in the fourth quarter of 2022.

Tether’s investment arm has proposed merging three companies to create a leading public organisation in the Bitcoin industry. This involves the merger of Twenty-One Capital (XXI), financial services provider Strike, and mining platform Elektron Energy.