Here’s why BTC and altcoins like Pepe, EOS, Bonk, Fartcoin are rising
The crypto market crawled back slightly on April 1 as investors bought the dip after a brutal quarter in which Bitcoin and Ethereum dropped by 12% and 45%, respectively.
Bitcoin (BTC) price rose slightly to $84,000, while Pepe (PEPE), EOS (EOS), Bonk (BONK), and Farcoin (FARTCOIN) gained over 5% in the past 24 hours. Total trading volume across exchanges rose by 18%.
This rebound was notable as U.S. stock index futures continued their downtrend. Futures tied to the Dow Jones fell by 250 points, while the Nasdaq 100 and S&P 500 indices dropped by 0.50%.
One potential catalyst for the performance of Bitcoin and other altcoins is data showing that BTC and ETH balances on exchanges have declined, representing a signal that the selling pressure may be easing.
CoinGlass data shows that there were 2.2 million coins on exchanges, down from 2.25 million in March. ETH balances have slipped to 14.5 million, the lowest point in years.
BTC and altcoin rebound may be a dead cat bounce
The rebound could also be part of a dead cat bounce, as market risks remain elevated. A dead cat bounce refers to a situation where an asset in a downtrend experiences a temporary recovery before resuming its decline. It’s also known as a bull trap.
The case for this being a dead cat bounce has strengthened due to several looming risks. Chief among them is Donald Trump’s upcoming Liberation Day on Wednesday, when he is expected to unveil sweeping tariffs in an effort to raise funds for tax cuts and boost U.S. manufacturing.
Other countries, especially in the European Union, have warned that they will respond with retaliatory tariffs. This could spark a trade war and drive inflation higher, potentially forcing the Federal Reserve to delay its planned interest rate cuts.
Bitcoin price technicals point to more downside
Another reason the current BTC and altcoin rebound may be a dead cat bounce lies in technical analysis. The chart above shows that Bitcoin is still flashing bearish signals. It remains below the 50-day moving average, a sign that bears remain in control.
Bitcoin has also fallen below the key resistance level at $89,156, which marks the neckline of the double-top pattern at $108,410. It has even completed a break-and-retest pattern by briefly retesting that neckline.
Therefore, there is a strong likelihood that Bitcoin will resume its downtrend and potentially retest last month’s low of $76,485. The bearish outlook will remain intact as long as the price stays below the resistance level at $95,000.
If this forecast plays out, altcoins like Pepe, EOS, Bonk, and Fartcoin are also likely to resume their downward trend.
