Markets were generally constrained within a defined range over the past week, paving the way for a potentially explosive upward move, some say.
The cryptocurrency market stabilizes around $3 trillion, with Bitcoin moving around $95,000 and analysts expecting a potential breakout.
Bitcoin ETFs experienced outflows of $56 million, ending an eight-day streak of inflows totaling nearly $3 billion.
Analysts point out that prolonged consolidations and negative funding rates may lead to a strong upward move in Bitcoin, with macroeconomic factors also impacting market sentiment.
The cryptocurrency market remains in a long-term consolidation phase as the total market value approaches $3 trillion, with analysts watching for a potential Bitcoin (BTC) breakout that could drive the market higher.
Bitcoin hovered around $95,000 on Thursday, while Ethereum (ETH), BNB from the BNB chain, and SOL from Solana remained stable. XRP and ADA from Cardano fell by 2%, while Dogecoin (DOGE) dropped by 3%.
Bitcoin spot ETFs saw outflows of $56 million on Wednesday, breaking an eight-day streak that witnessed inflows of nearly $3 billion into these products listed in the United States.
Markets were generally constrained within a defined range over the past week, paving the way for a potentially explosive upward move, some say.
Alex Koptsevich, senior market analyst at FxPro, told CoinDesk via email: "Typically, these long consolidations bolster market strength for further moves. The labor market data released on Friday is likely to be the next major catalyst."
Over the past five days, the market has fluctuated within a very narrow range, with a slight bias toward minor declines. However, it has been unable to surpass its 200-day moving average, which now exceeds $3.01 trillion. A market breakout requires a global increase, but it would open the way toward the $3.5 trillion area, added Koptsevich, noting strong movements in alternative currencies.
Pat Chang, head of research at WOO X, expressed this view. He stated in a message via Telegram: "Bitcoin still exhibits volatility, forming a consolidation range between $93,000 and $95,000 since April 25, enhancing the momentum for a potential breakout."
Chang added: "The average funding rate for Bitcoin was negative over the past week, which is rare, indicating intense whale activity both on and off exchanges."
Over the past two years, the funding rate for Bitcoin contracts has been negative only four times, specifically during the periods from September 19 to 22, 2023, from October 20 to 27, 2023, from August 16 to 24, 2024, and from September 10 to 17, 2024.
Chang noted that "after these periods of negative funding rates, Bitcoin has experienced strong upward trends, indicating that whale accumulation may place Bitcoin in a potentially bullish position."
Macroeconomic sentiment remains weak as traders worldwide watch for the next steps President Donald Trump will take in the ongoing tariff conflicts.
According to Bloomberg, Trump acknowledged on Wednesday that his tariff program is facing a public perception problem and poses a significant political risk, but he remains determined to move forward. He stated that "potential deals" with South Korea, India, and Japan are already in place, and a deal with China is progressing in his favor.
By Shourya Malwa | Edited by Parikshit Mishra
Updated on May 1, 2025, at 9:22 AM
Shourya Malwa
Shourya is the co-lead of the Token and Data team at CoinDesk in Asia, focusing on cryptocurrency derivatives, decentralized finance, market microstructure, and protocol analysis.