Yesterday evening and overnight BTC has dropped below the support line of the bull pennant. There have been wicks below the bull pennant so dips down to $58-59k are still fine as long as they get bought up. This dip is a bit more concerning with a steeper drop down to $57k and the price has remained below the bull pennant support line for several hours. I would wait and see if the FOMC leads to a bullish rebound today for BTC to rebound. If that does not happen then BTC is at risk of dropping to $53k. My approach is to continue to DCA on all dips over the next few weeks. I think May is likely to be a bullish months for crypto and stocks. I’ve been patiently waiting for April to end, and May is finally here.

There has been a lot of fear in the crypto markets over the past few weeks with concerns that BTC and crypto will have a steep drop. In previous weeks this fear stemmed from the Israel-Iran tensions with concerns about WWIII. Today the crypto fear & greed index has sharply declined after the bull pennant support line has broken. For now I think this is some tricky price action designed to shake out weak hands. The Fed appears pretty dovish today, we’ll have to see if this dovish sentiment remains during Powell’s speech. I’m leaning towards a bullish rebound in May, which is one of the most seasonally bullish months for the crypto markets especially during Presidential election years. As a reminder, TrendSpider’s seasonality index reveals that during Presidential election years BTC has a 100% bullishness rate in May with an average return of +10.50%.

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