Bitcoin (BTC) starts the first full week of May with yearly open support in focus ahead of a key US economic policy decision.
BTC price action attempts to hold the yearly open as support after some downside at the weekly close, but bullish perspectives remain intact.
The US Federal Reserve interest rate decision is the key macro event of the week, with Chair Jerome Powell tipped to “move markets.”
Jobless claims and Coinbase earnings add to a mixed bag of potential volatility triggers as recession talk gets louder.
Bitcoin dominance hits 65% for the first time in over four years, but analysis thinks its days are numbered.
Bitcoin “FOMO” is still waiting in the wings as sentiment flips positive.
Bitcoin traders stay bullish with $93,500 intact
Bitcoin saw some sell pressure into the May 4 weekly close, reaching lows of $93,350 on Bitstamp before rebounding, data from Cointelegraph Markets Pro and TradingView shows.
Liquidity had built up close to the spot price, both up and down, with bids getting partially filled due to the dip.
Now, the latest data from monitoring resource CoinGlass shows the largest nearby cluster of ask liquidity at $96,420.
Popular trader CrypNuevo outlined a potential short-term bull case in his latest outlook on X.
“In the case of long triggers, I like these two setups: Either a new local high ($98k) where we can see some LTF liquidations after a reclaim of the previous range highs (upper yellow line), or from much lower from the 1D50EMA retest if it’s successful,” he wrote.
Fellow trader Daan Crypto Trades eyed a new “gap” to the upside on CME Group’s Bitcoin futures markets as a potential price magnet.
“These gaps have generally been getting closed within 1-3 days recently so it can be useful to keep an eye on it,” part of an X post read, with the gap at $97,000.
Zooming out, however, popular trader and analyst Rekt Capital focused on downside support at $93,500 — Bitcoin’s yearly open.
“Bitcoin has rejected from the Lower High resistance (black diagonal),” he explained alongside an accompanying weekly BTC/USD chart.
“Going forward, Bitcoin will need to hold the $93.5k Range Low to fully confirm a reclaim of the Range.”
Separate analysis suggested that Bitcoin could form a series of higher highs with rejections and support retests at key price points, ultimately breaking out to new all-time highs.
#BTC
Bitcoin Price Discovery Roadmap
Bitcoin is trying to finalise its First Price Discovery Correction (green) to transition into its Second Price Discovery Uptrend (red)
(Prices and time horizons are not to scale)$BTC #Crypto #Bitcoin https://t.co/yfY3h60Ywy pic.twitter.com/yahXUIpVkY
— Rekt Capital (@rektcapital) April 30, 2025
FOMC week puts spotlight on Fed
In contrast to last week, the coming days are dominated by one macroeconomic event in particular: the Federal Reserve decision on interest rates.
The May 7 meeting of the Federal Open Market Committee (FOMC) is being closely watched by traders in crypto and beyond.
The circumstances surrounding the meeting are unusual — the Fed remains hawkish on the economy, seeking to hold rates steady in the face of rising economic risks and talk of recession. The ongoing US trade war has added to concerns that inflationary pressures may return, bolstering the Fed’s stance.
Despite this, US President Donald Trump has been vocal about the need for rates to come down, personally singling out Fed Chair Jerome Powell on social media on several occasions.
What happens at the meeting will thus form a clear signal over what traders can expect further into the year.
🇺🇸 FOMC: This Wednesday, the Fed will decide whether to cut, hike, or keep rates unchanged.
What’s your prediction? 👇 pic.twitter.com/cUkhGyHdIR
— Cointelegraph (@Cointelegraph) May 5, 2025
“All eyes are on Fed Chair Powell this week after recent pressure from Trump to cut rates,” trading resource The Kobeissi Letter summarized on X.
While tensions over the decision are palpable, markets nonetheless see little chance of a surprise move by officials. The latest data from CME Group’s FedWatch Tool put the odds of a rate cut at just 5.2% as of May 5.
Over the weekend, Cointelegraph reported on expectations regarding Bitcoin’s reaction to the meeting. In general, crypto and stocks tend to fall in advance of FOMC dates as traders hedge their bets over the outcome and the Fed’s perspective on future policy.
“If a standard pre-FOMC correction takes place, then the go-to zone for entries is between $91.5-92.5K,” crypto trader, analyst and entrepreneur Michaël van de Poppe told X followers in part of a recent post on the topic.
Trading resource Material Indicators added that Powell’s language at the FOMC press conference would “move markets” regardless of the rate decision.
Bitcoin faces booming recession bets
Beyond FOMC, other macro topics on the radar for crypto and risk assets include the initial jobless claims report on May 8, as well as earnings from major US crypto exchange Coinbase.
Bitcoin has become increasingly sensitive to US employment data in recent months, making a major divergence from expectations a potential source of volatility.
While the labor market has stayed resilient to threats such as the ongoing US trade war, reports of the economy entering a period of “stagflation” or even recession are increasing.
“US consumers’ recession expectations are skyrocketing: Americans’ perceived likelihood of a US recession over the next 12 months rose to 72% in April, the highest in 2 years. Since November 2024, this percentage has surged by 8 points,” Kobeissi noted.
Data from other consumer sources, such as prediction service Kalshi, echoes that sentiment.
“Such a pessimistic view of the economy and financial situation will likely lead to more pullback in consumer spending,” Kobeissi concluded.
“All signs point to an economic slowdown.”
In the latest edition of its regular newsletter, “The Market Mosaic” on May 4, trading firm Mosaic Asset referenced last week’s Q1 GDP miss as “the latest sign that tariffs and trade wars are delivering a major hit to the economy.”
“Evidence that the economy is holding up against the turmoil and uncertainty caused by trade war headlines is helping the S&P 500 to recover most of the selloff following the announcement of reciprocal tariffs,” it nonetheless acknowledged.
Since Trump’s tariff-driven “Liberation Day” on April 2, Bitcoin is up by around 15%.
Bitcoin dominance starts “final countdown”
In crypto circles, anticipation of the genuine start of the next altcoin rally is increasing.
Bitcoin’s share of the total crypto market cap reached 65% over the weekend, marking its highest level since early 2021.
The rapid dominance increase over the past two years reflects frustrating conditions for altcoin investors, with attention focusing on the largest altcoin, Ether (ETH), in particular.
ETH/BTC recently traded near levels not seen since 2019, with even a modest turnaround leading traders to bet on the start of a longer trend inflection.
Bitcoin dominance crashes.
ETH/BTC starts to pump.
Then altseason starts.
Any questions? pic.twitter.com/SOuVWx7nLK
— Mister Crypto (@misterrcrypto) May 4, 2025
“Bitcoin Dominance is now in the process of positioning itself for what will most likely be its final leg in its Macro Uptrend before a major collapse,” Rekt Capital predicted in an X update on May 1.
“The road to 71% continues on successful retest of 64%. But it is the Final Countdown.”
Rekt Capital previously observed that 71% marks long-term tops for Bitcoin dominance. The last “altseason,” he argued earlier this year, ended in 2024.
Some, however, see the latest dominance rise diverging from historical norms. For Thomas Fahrer, co-founder of crypto reviews portal Apollo, this is due to increasing institutional demand for BTC.
“This cycle is different because when Blackrock & Saylor buy Bitcoin they just hold it. They don’t swap them for alt coins,” he wagered last week, referring to ongoing purchases by the US spot Bitcoin exchange-traded funds, or ETFs, as well as business technology firm Strategy.
Bitcoin sentiment shifts from “ideal buy time”
As the Crypto Fear & Greed Index hovers in “neutral” territory, analysis is reiterating the risks of “FOMO” returning to the market.
Related: Bitcoin price cools going into Fed rate hike week, HYPE, AAVE, RNDR, FET still look bullish
In its latest market update on May 1, research firm Santiment revealed a turnaround in social media user expectations for BTC price performance.
“We can see that social media was making lower price calls ($10K–$69K) during the stretch between Apr 6–18, 2025,” it wrote about the environment after Liberation Day.
“This was the ideal buy time. After prices eventually hit a temporary plateau at the end of April, high price calls ($100K–$159K) are now greatly exceeding lower calls.”
Santiment previously warned that “FOMO” among new investors may hamper Bitcoin’s attempts to preserve higher prices for longer.
“Overall levels of discussions toward Bitcoin remain quite steady, currently at about 25% of all asset topics,” it now reports, noting that positive commentary is gaining prevalence.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
