Cryptocurrency markets rebounded slightly on Thursday but remained below their March highs, weighed down by volatility and weakness ahead of the halving.
With less than 30 hours until Bitcoin’s (BTC) next halving, cryptocurrency supporters are eager for the market to return to a bullish trajectory after the cryptocurrency’s recent correction after breaking above $64,000 in early March.
Data shows that Bitcoin rebounded from a low of $59,650 on Wednesday to hit an intraday high of $64,200 on Thursday before falling back to support at $63,300.
On Thursday, the top 200 altcoins by market cap saw mixed gains and losses. Livepeer (LPT) saw the biggest gain, up 12.7% to $13.27, Jito (JTO) rose 10.9%, and Centrifuge (CFG) rose 8.5%. Meme coin cat in a dogs world (MEW) fell 11.7%, leading the decline, while Core (CORE) fell 9% and Sui (SUI) fell 7.3%.
Currently, the total market value of cryptocurrencies is 2.3 trillion US dollars, and Bitcoin accounts for 54.2% of the market.
Concerns about U.S. inflation and interest rates remain a source of market volatility. Atlanta Fed President Raphael W. Bostic reiterated on Thursday that he does not expect a rate cut before the end of the year. Minneapolis Fed President Neel Kashkari also said that he needs to be patient until he is sure that inflation has fallen, and he may not consider a rate cut until 2025.
U.S. stocks opened lower on Thursday, rose in the middle, but fell back into the red zone at the close. The S&P and Nasdaq fell 0.22% and 0.52% respectively, while the Dow was flat. Despite the stock market retreat, the dollar index rose 0.4% to 106.152, while the U.S. 10-year Treasury bond rose 7.6 basis points to 4.638%.
Analysts at Secure Digital Markets said: “The S&P 500 experienced volatility as Wall Street sought stability after consecutive declines. The Nasdaq, particularly affected by the downturn in technology stocks, fell more than 3%, suggesting that the Nasdaq may fall for the fourth consecutive week, which would be the longest downturn since December 2022.”
“Overall, the recent decline in equities can be attributed to waning expectations of rate cuts, prompting investors to book profits after a strong first quarter of the year,” they noted.
Analysts’ view: BTC is expected to reach its next peak in September or October next year
Bitcoin's weakness over the past few weeks has been associated with a decline in outflows from spot BTC ETFs, with net flows negative every day since Friday. Data shows that outflows reached a recent peak of $165 million on Wednesday, led by Grayscale's GBTC, which accounted for $133.1 million of the amount, while BlackRock's spot Bitcoin product recorded the lowest inflow of only $18.1 million.
Although prices are expected to continue trading sideways in the short term as the halving occurs and ETF flows moderate, most analysts expect Bitcoin’s price to eventually resume its uptrend.
Market analyst Rekt Capital said that based on previous halving cycles, BTC may reach its next peak in mid-September or mid-October 2025. He added: "The current market conditions show that spot premium is higher than futures, which indicates that speculative trading has decreased, which is a favorable sign."
Market Watch: BTC social media sentiment turns pessimistic?
Market intelligence firm Santiment says crypto investor sentiment has turned pessimistic following the latest drop in Bitcoin prices.
In an April 18 post, the company shared a chart showing the crypto community’s consistent bearish comments on Bitcoin and other tokens like Ethereum: “Sentiment remains bearish on majors, reinforcing the argument for more upside.”
The data shows that the number of mentions of “bull market” or “bull cycle” on crypto social media has declined since Bitcoin hit an all-time high of $73,835 on March 14.
Meanwhile, the number of mentions of a “bear market” or “bear cycle” has steadily increased. Historical data shows that bearish sentiment is usually observed at market bottoms.
Santiment analysts wrote: “Historically, price moves in the opposite direction to what the public traders expect. A rapid decline in FOMO coupled with a significant rise in FUD is a promising combination that the crypto market may experience before or after the halving. See recovery soon.”
According to Bitcoin social media sentiment data tracked by Alternative.me, the Crypto Fear and Greed Index has fallen sharply from 76 last week and 79 last month, but remains in the "greed" zone at 57, indicating that trader sentiment is gradually becoming optimistic despite more than a week of price adjustments.
