Bitcoin price started the new month in the red despite ending the first quarter of the year higher after navigating its first banking fiasco and another regulatory crackdown. Even so, BTC still hovers around its highest level this year. At press time, Bitcoin, the largest cryptocurrency by market cap, was trading at $28,258.20, shying away from its intraday high of $28,500.99.

Fundamentals

Bitcoin price, as well as other cryptocurrencies, slipped on Monday but remained near recent highs. In the past 24 hours, Bitcoin price has been changing hands at around $28,300. Its market cap has also slipped over the same period, while the total volume of the coin traded edged higher.

Markets have been reacting to the latest announcement by the Organization of Petroleum Exporting Countries (OPEC) and its allies. OPEC+ announced on Sunday that it would slash its output by 1.16 billion barrels per day starting from May 2023. In the announcement, Saudi Arabia stated that the cuts would stabilize the oil market.

The announcement saw the oil prices surge by more than 5%, with US West Texas Intermediate (WTI) crude futures jumping by 6% to $80.27 per barrel and Brent crude futures climbing by 5.88% to $84.58 per barrel. However, the Bitcoin price inched lower on the back of the announcement, hitting an intraday low of $27,560. The soaring oil prices threaten to stoke inflationary pressures, prompting the Fed to impose more aggressive measures. Higher inflation rates would stir up pressure on risk-sensitive assets such as stocks, and especially cryptocurrencies such as Bitcoin.

The US Dollar Index has recently shown signs of growth, hinting at a strengthening of the United States’ official currency. A stronger US dollar can create headwinds for risk assets such as digital assets. An increase in the valuation of the US dollar could improve investors’ confidence in traditional financial institutions, shifting their focus away from risk assets. Consequently, this would lead to a decrease in demand for cryptocurrencies such as Bitcoin, prompting a drop in their prices.

Bitcoin Price Analysis

The daily chart shows that the Bitcoin price has been cruising slightly below its 10-month high for the past few days. Even so, the crypto leader has managed to remain above the 25-week and 50-week moving averages, as well as the 50-day and 200-day exponential moving averages.

Its Relative Strength Index (RSI) has inched lower but remains above the neutral zone. The Moving Average Convergence Divergence (MACD) indicator is bearish. As such, the Bitcoin price is likely to decline slightly before bouncing back higher. Even so, I expect the BTC price to remain above the crucial support level of $26,500.

BTC Price Chart