Bitcoin dropped to the $95,000 range during the weekly close on May 4 as traders prepared for the next drop due to macro impacts.
BTC 1-Hour Price Chart | Source: TradingView
Bitcoin price was heavily liquidated after reaching a 10-week high.
Data from TradingView shows BTC is pulling back from multi-month highs, returning near the opening price of May.
Touching dense liquidity zones around the spot price, Bitcoin created a 'formula' for volatility as market participants discussed key price levels.
"A dense cluster of long orders at $95,700–$96,000, while short orders are concentrated in the $96,500–$97,000 range, right around the $96,200 price level. These are price magnets. Expect the market to oscillate and be volatile as the price tests these levels," famous trader TheKingfisher wrote in an analysis posted on X.
BTC Liquidation Map | Source: CoinGlass
The latest data from monitoring platform CoinGlass shows that Bitcoin price hit the buy liquidity zone, with the majority of ask orders concentrated around $97,200.
Over the past week, the market has seen several liquidity grabs, leading some to predict this behavior may continue as the crucial $100,000 mark approaches.
"Positions from $94,000–$97,000 were wiped out over the weekend," famous trader BitBull summarized.
Assessing the risk of further adjustment, analyst, trader, and entrepreneur Michaël van de Poppe stated that BTC still has plenty of room to retest the support zone while maintaining its recent recovery momentum.
"What I want to see in BTC is for the price to hold above the $91,500–$92,000 range. That would confirm that the trend towards a new ATH is still ongoing, as the old support zone becomes a solid foundation," he shared.
BTC 1-Day Chart | Source: Michaël van de Poppe
Bitcoin may decline before the Fed decides to cut interest rates.
Expectations for market volatility are heightened as the new trading week begins, amidst the backdrop of the U.S. Federal Reserve (Fed) preparing to announce its interest rate decision.
As reported, market sentiment is tense ahead of this event. Warnings about economic recession alongside pressure from President Donald Trump resonate with the 'hawkish' signals from Fed officials.
However, the latest data from CME Group's FedWatch tool still shows a very low likelihood of the Fed cutting interest rates on May 7.
Fed target interest rate probability for the FOMC meeting on May 7 | Source: CME Group
"Remind yourself that the crypto and altcoin market often tends to adjust in the week before the Fed meeting. I suspect this adjustment will end around Tuesday and from there the price will start to rise again," Van de Poppe commented.
Disclaimer: This article is for informational purposes only and is not investment advice. Investors should do thorough research before making decisions. We are not responsible for your investment decisions.
