Specialist RBC Crypto analyzed the situation on the market and assessed the prospects for the movement of the bitcoin rate for the next seven days.
“Uncertainty and volatility persist”
Financial Analyst BitRiver Vladislav Antonov
Over the past week, significant price fluctuations have occurred in the cryptocurrency and financial markets. They were associated with news about the ceiling of the US national debt, corporate reporting, as well as statements by the Republicans about raising the national debt ceiling. As a result, the markets experienced fluctuations, which were reflected in the volatile prices of bitcoin and other risky assets.
However, Bitcoin has shown some stability in this market, up 6.16% since the start of the week to $29,291 by the end of the week. However, uneven movements were noted in its price throughout the week, reaching a maximum of $30,036 and a minimum of $26,942.
In the first half of the week, there was a risk of a technical default on the US government debt and US Treasury Secretary Janet Yellen’s statement about the need to cancel the government debt ceiling. As a result, the cost of insuring against default by the US government has risen to new highs recently, and the US government debt has topped $31.7 trillion. Such factors have caused investors to fear that the world’s largest economy will not be able to meet its financial obligations.
However, positive news later appeared – the Republicans of the US House of Representatives proposed to limit the rights of the popular Securities and Exchange Commission (SEC) regarding stablecoins. This proposal only affects the stablecoins that will be used for payments and may give a new impetus to the market.
During trading in the European session on April 26, the BTC/USDt pair rose to $30,036 (+11%), but fell to $27,235 (-9.33%) in the American session. A fall in prices in the American session could cause US stock indices, and bank shares came under pressure due to a further decrease in the capitalization of First Republic Bank, which amounted to 54% over two days to $5.69. Such a drop exacerbated investors’ fears about a possible banking crisis and increased the likelihood of bad reports from other major banks.
On April 27, the price of bitcoin recovered to $29,480 (+8%). In this regard, the market could be affected by the news that the US Congress passed a bill proposed by the Republicans to raise the national debt ceiling by $1.5 trillion while reducing spending. However, it should be noted that uncertainty and volatility still remain in the cryptocurrency market. On April 28, the price of bitcoin continued to fluctuate in the range from $28,829 to $30,457, showing volatility in the market.
Market participants are awaiting the results of the US Federal Reserve meeting and the press conference of Fed Chairman Jerome Powell. They can be key factors in determining the direction of the price of Bitcoin and other risky assets in May.
In general, sentiment in the crypto market is positive towards bitcoin, especially after the US Congress passed a bill to raise the national debt ceiling and reduce spending. The S&P500 closed the week in positive territory, while the dollar index was slightly negative.
Bitcoin is worth $29,390. BitRiver estimates that the May trading price range will be $26,500-$31,000. I tend to believe that the price will remain in the specified range until the US Federal Reserve meeting and will exit it after June 1, 2023. If suddenly the news background develops in such a way that buyers can pass the $31,000 level earlier, then $35,000 will appear on the horizon.
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