Bitcoin is struggling with the Fibonacci 38.2 resistance as its breach above that level last week ran out of gas! Bulls weren’t able to hold on to their firm control of crypto markets as they did the previous week. As I wrote, traders took profits as the RSI indicator approached the overbought zone - though without crossing the 70% threshold level. A glance at the Bitcoin daily chart reveals the bullish trend is alive still as the trend has not reversed. However, the bulls don’t have a firm upper hand and bears may drive the price farther down this week before a rebound and fresh test of $46,670!
The global stock market’s advance slowed last week while strong US jobs market data solidified views the Federal Reserve will pick up pace at its next meeting in May by hiking interest rates by 50 basis points instead of 25 basis points. Bitcoin rebound peaked as Luna Foundation Guard (LFG), a non-profit organization focused on UST, seemed to slow its purchases of Bitcoin. The European Parliament was considering new European Union rules last week that will apply anti-laundering identification rules to the sector. At the same time a bill was introduced last week in US aimed at bringing greater transparency to the stablecoin marketplace.
LFG’s purchases of Bitcoin provided considerable support for the price last week too. LFG announced last month that it had raised $1 billion through an over-the-counter sale of LUNA, the native token of the Terra blockchain. LFG spent $125 million worth of USDT all weekdays the prior week and $160 million on Saturday. However, it took a break on Tuesday.
The crypto industry is opposed to new European Union rules that would apply so-called travel rule, extending anti money-laundering identity checks to payments made in digital currencies, even if they are under an existing threshold of 1,000 euros. Lawmakers claim tougher rules are needed to stop crypto ending up “in the wrong place, for example with terrorist groups.”
Last Thursday two US lawmakers introduced “Stablecoin Transparency Act” in both the House of Representatives and Senate . The $180 billion stablecoin market has become a concern for regulators. The bill would set standards for the “quality of assets held in reserves” as well as require stablecoin issuers to report on their reserves. If passed, the bill would have a significant impact on stablecoin issuers including Circle and Tether, whose stablecoins` backing has been the source of much speculation in the crypto industry.
