Bitcoin Trader Maintains $40.8K BTC Price Objective Despite Risk Asset 'Pain Trade' Warning

2022-05-05 | Selina Mathew

Bitcoin Trader Maintains $40.8K BTC Price Objective Despite Risk Asset 'Pain Trade' Warning

What might enrage investors more than stock and cryptocurrency surrender is sideways trading "for a long period."

Bitcoin (BTC) stabilized below $40,000 on May 5 following a one-week high in US economic policy optimism.

The Federal Reserve has had minimal impact on the cryptocurrency market.

BTC/USD 1DAY PRICE CHART: SOURCE - COINMARKETCAP.COM

Following statements from the Federal Reserve and Chair Jerome Powell verified an overnight top of $40,050 on Bitstamp.

With a 0.5 percent key rate rise, the US central bank met market expectations, implying that further raises would be forthcoming.

Following that, a tiny market gain left Bitcoin with an eerie lack of volatility, in stark contrast to past Fed announcements on themes like inflation.

While many anticipated risk assets, including cryptocurrency, to collapse as a result of the new policy, not everyone thought that such a scenario would bring investors the most pain.

"With so many people clamoring for meltups and meltdowns," economist Lyn Alden suggested, "maybe the pain trade is to chop sideways in risk assets for a long period."

Similarly, no big trend shifts were expected in Bitcoin circles. Low financing rates on BTC futures markets were noticed by Ben Lilly, a token economist at Jarvis Labs.

Bitcoin's "max agony" is still a long way off.

Popular trader Crypto Ed waited for a further push above the $40,000 barrier on May 5, focusing on lesser timeframes.

BTC/USD was on track to achieve $40,800 for him, and while there were "a lot of factors" to rule out a more large rise, it was still a possibility.

Meanwhile, on-chain monitoring site Whalemap reiterated its prior prediction that the range between $25,000 and $27,000 would represent "peak agony" for Bitcoin hodlers in terms of price capitulation scenarios.

As part of Twitter comments, it added, "A lot of liquidity and stop losses are stacked there."

 

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