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Bitcoin Lethargic as May Starts, Though Month Could Prove Pivotal

The largest cryptocurrency is up 1.3% so far in May, a month where returns historically have averaged 27%. But at least one analyst suggests the price could still drop as low as $32,000.Read MoreFeedzy

Bitcoin (BTC) has started off May with the same listless price action that prevailed for most of April, although analysts say the coming month could prove decisive.

The largest cryptocurrency by market capitalization is up 1.3% through the first two days of May, changing hands around $38,310 as of press time.

Historical data shows that May is typically a strong month for bitcoin, with gains averaging 27% over the past 11 years.

A repeat in 2022 would be welcomed by bitcoin bulls, especially after April’s 17% rout – the cryptocurrency’s worst monthly performance so far this year. Bitcoin has declined over the past four weeks alongside weak U.S. stock markets, and lately it has been especially correlated with the tech-focused Nasdaq 100 Index.

Alex Kuptsikevich, senior market analyst at FxPro, estimates BTC will end May somewhere between $32,000 and $48,000.

“A more local view of the dynamics of the first cryptocurrency indicates an ongoing struggle around the $38K mark,” said Alex Kuptsikevich. “This struggle will decide which of the above levels the price will be closer to at the end of the month.”

IntoTheBlock analysts see macroeconomic conditions impacting crypto’s outlook through the rest of 2022.

“Both bitcoin and [ether] saw net outflows from centralized exchanges in the hundreds of millions,” wrote IntoTheBlock in a newsletter, “suggesting buyers continue to accumulate on their private addresses.”

CoinDesk’s Omkar Godbole reported earlier Monday that bitcoin is historically immune to the “should I sell in May?” sentiment prevalent in some other assets. In the past 11 years, seven of them saw bitcoin trade higher in May.

Ether (ETH), the native cryptocurrency of the Ethereum blockchain, was down 0.4% in the past 24 hours, trading at $2,803.

U.S. stocks are down Monday. The S&P 500 was down 0.78% and the Nasdaq was down 0.5%.

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