The quotes of the first cryptocurrency hit the lowest levels of the current year. 

Bitcoin Dropped to 2022 Low

On May 9, Bitcoin fell below $33,500 in the morning. The previous low in 2022 was recorded on January 22 — BTC was around $35,000, according to CoinMarketCap. Over the past seven days, Bitcoin has lost more than 14%. The total capitalization of the crypto market over the past week decreased by 13.5% to $1.52 billion.

The Fear and Greed Index stands at 10 amid the current situation in the crypto market. It means “extreme fear.” Glassnode reports that a 7-day moving average of BTC inflows on CEXs is hitting three-month highs of more than 1,750 BTC per day, indicating a sell-off of the asset. 

The market is reacting to several factors directly: 

  • the results of the May 4-5 Fed meeting — a 50 basis point key rate hike and balance sheet reduction; 
  • pressure on sellers, who are closing short positions en masse; 
  • the high correlation between BTC and tech companies’ stocks, which are declining. 

Some analysts have suggested that Bitcoin has exhausted the growth potential set by the last halving, and are predicting a “crypto winter.” Particularly, the crossing of the 50-day (MA50) and 200-day (MA200) averages of BTC is pointing this out. The analyst noticed that this is the formation of a “death cross,” a signal of a possible decrease in the asset value from the perspective of technical analysis.

Author: Evgeny Tarasov
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