Back in the zone of maximums

The market was facing a difficult week with the Fed meeting, and more than ever with the unknown of what was going to happen with monetary policy after seeing the state of the US banking sector and the sensitivity it showed to the rise in rates.

In fact, the market was already discounting a loosening of monetary policy and that was precisely what was dangerous. If the Fed did not step off the accelerator as the market demanded, we could have had significant moves lower.

The Fed opts for prudence

But that has not been the case, and the FED opted for prudence, which in this case means that the rate hike remained at 25 bp, when a few weeks ago the clear forecasts were around 50 bp. Still, that rally had a controlled impact on the crypto market, and we saw bitcoin quickly give up ground, but without threatening any major resistance areas.

This movement reveals several things, but what I think is most important:

Today, the decisions of the FED affect crypto assets equally as traditional assets because they condition the availability of liquidity

If we think about it, it is something that has a certain logic:

• Right now, the crypto asset market is small in terms of capitalization
• For rises to occur in the market, it depends on the provision of external liquidity (From the FIAT market)
• This liquidity is directly related to the policies of the Fed

So it is clear that for now the dependency exists and we are going to have to wait for another market context to see if crypto assets are a market that can go outside the decisions of the Federal Reserve.

The bullish movement of Bitcoin

Leaving aside this last movement, the truth is that the last days of Bitcoin are spectacular. The Silicon Valley Bank episode sent us hitting levels below $20,000 just 14 days ago, and we are now topping out at $28,000.

This area corresponds to a level that some indicators consider quite critical. Specifically, our indicator of distance to ATH from the market, what we call crypto oscillator, has been marking this 40 point zone as very important for some time. Right at the point where we are now.

Structure of the bullish movement

Another factor to take into account is the structure of the movement. We can see in some graphs how the concentration around Bitcoin is important. Not surprisingly, bitcoin's dominance is at its highest since May of last year. This is also an important fact.

Altcoins have not clearly benefited from this movement, we have even seen a drop. The mere comparison of the intensity indicators of stable coins and alt coins indicates that the money that has gone to risky assets in this market has not been positioned in the Defi ecosystem. The dominance data gives us the answer. The money has gone to bitcoin and remains there until that time.

We can also appreciate it from the fact that bitcoin's 7-day revaluation is higher than any other asset. In a clearly bullish market this would not be the case.

Ethereum, waiting for Shanghai

Another of the passive players at the moment is Ethereum, which seems to not have many arguments right now to try to wrest the leadership of the movement from bitcoin. The issue of the upcoming network update (Shanghai) this coming April is still weighing. We will follow this news closely, because not only is it going to influence Ethereum itself, the prices of other assets also depend on the performance of its network, which right now base part of its attractiveness on lower commissions.

Watching the market

We are entering the weekend again and we should be a little attentive to the market. Given the situation, more than ever, what can mark the evolution in the next few hours will be the price of bitcoin.

A break of $28,600 would certainly clear the way to $30,000, and a loss of $26,600 would leave us in an area of indecision again. It remains to be seen when the rest of the market, which for now is clearly behind Bitcoin, could come into action.

DYOR