Decentral Block Post

Bitcoin (BTC) starts a new week in an altogether different mood as the weekly candle close brings a move higher.

The largest cryptocurrency, still stuck in a narrow range, is at last showing signs of life after several spikes to two-month lows.

With volatility back in play, traders nonetheless remain conflicted. Can short-timeframe strength lead to an overall trend breakout?

Opinions differ as May ends and brings a macroeconomic showdown that is already making itself felt: the United States debt ceiling deal.

With an agreement to raise the ceiling and avoid a U.S. government default almost here, risk assets may see relief across the board. However, since stock markets are closed until May 30, it will be a game of “wait and see” for Bitcoin traders to start the week.

The United States looks to avoid a catastrophic debt default after the White House and the House Republicans agreed upon a tentative deal on May 27. The U.S. equities markets rallied in anticipation of the deal on May 26 and the positive sentiment has rubbed off onto the cryptocurrency sector, which is attempting a recovery.

Buying is not limited to Bitcoin (BTC) alone as select altcoins are also showing signs of a short-term up-move. However, sustaining the rally at higher levels may prove to be difficult for the bulls.

After the debt ceiling deal, traders are likely to focus their attention on the Federal Reserve’s rate hikes. The hot Personal Consumption Expenditures data on May 26 increased the likelihood of a rate hike at the Fed’s June meeting. The probability of a 25 basis point rate hike has risen from 17% a week back to 64% on May 28, according to the CME FedWatch Tool.

Along with Bitcoin, what altcoins that are looking ripe for a short-term up-move? Let’s study the charts of these top five cryptocurrencies to spot the important levels to watch out for.

Bitcoin price analysis

Bitcoin has reached the overhead resistance zone between the 20-day exponential moving average ($27,146) and the support line of the symmetrical triangle. This zone is likely to witness a solid tussle between the bulls and the bears.

The United States looks to avoid a catastrophic debt default after the White House and the House Republicans agreed upon a tentative deal on May 27. The U.S. equities markets rallied in anticipation of the deal on May 26 and the positive sentiment has rubbed off onto the cryptocurrency sector, which is attempting a recovery.

Buying is not limited to Bitcoin (BTC) alone as select altcoins are also showing signs of a short-term up-move. However, sustaining the rally at higher levels may prove to be difficult for the bulls.

After the debt ceiling deal, traders are likely to focus their attention on the Federal Reserve’s rate hikes. The hot Personal Consumption Expenditures data on May 26 increased the likelihood of a rate hike at the Fed’s June meeting. The probability of a 25 basis point rate hike has risen from 17% a week back to 64% on May 28, according to the CME FedWatch Tool.

Along with Bitcoin, what altcoins that are looking ripe for a short-term up-move? Let’s study the charts of these top five cryptocurrencies to spot the important levels to watch out for.

Bitcoin price analysis

Bitcoin has reached the overhead resistance zone between the 20-day exponential moving average ($27,146) and the support line of the symmetrical triangle. This zone is likely to witness a solid tussle between the bulls and the bears.

The market dominance of stablecoins pegged to the United States dollar has undergone some changes over the past year. While most of them are in a downward trend, Tether (USDT) has climbed back to its all-time high, data from CoinGecko shows.

In the past 12 months, Circle's USD Coin (USDC) has seen its market share decline from 34.88% to 23.05% at the time of writing. Market participation of Binance USD (BUSD) plunged from 11.68% to 4.18% in the same period, while Dai (DAI) held its participation rate at 3.66%, down from 4.05% in May 2022.

Tether's USDT is moving in a contrasting trend. The stablecoin market dominance currently sits at 65.89% from 47.04% one year ago. Its market capitalization soared to $83.1 billion, while the USDC market cap dropped to $29 billion from its $55 billion peak.

In a recent interview with Bloomberg, Circle CEO Jeremy Allaire blamed the crypto crackdown by the United States regulators for the stablecoin's declining market capitalization. The current environment in the United States appears to be beneficial for Tether.

The U.S. banking crisis led to USDC depegging in March as reserves worth $3.3 billion were stuck at Silicon Valley Bank, one of three crypto-friendly banks shut down by regulators. Despite Circle's assurances, the market quickly responded to the news, causing USDC to depeg from the dollar.