Bitcoin (BTC) is stuck in a tight range with occasional price swings. The cryptocurrency is approaching a support zone between $40,000 and $43,000. Resistance at $48,000 and $50,000 have capped price rallies over the past four months, which means sellers are in control. Meanwhile, there has been a significant loss of downside momentum, suggesting that buyers could remain active at lower support levels.
At the end of last year, bitcoin increased in price by 1.6 times, to 46.2 thousand dollars from 28.9 thousand. Moreover, in the first quarter, the cryptocurrency has doubled in price — up to 58.7 thousand dollars. In November, the price of bitcoin reached a historical record of $69,000, after which it began to decline. This January, Bitcoin fell by almost 17%, in February its price recovered, rising by 12%. In March, the cryptocurrency fully restored the fall of January and grew by 5%. Despite the noticeable monthly dynamics, according to the results of the first quarter of 2022, the cost of bitcoin decreased by 1.5%. Since the beginning of April, the cryptocurrency has fallen in price by almost 7%.
Bitcoin has lost more than 12% of its value since April 4. On the night of April 12, its price dropped below $40,000 for the first time since March 16. Crypto analysts attribute the sell-off to the upcoming US tax week, US CPI release (you can read about it here) and the risk of a rate hike by the Federal Reserve.
The current pullback appears to be temporary, similar to what occurred in September of last year. This time, however, speculative assets such as stocks and cryptos are entering a seasonally strong period in April and May, which could attract short-term buyers.