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On Monday, May 22, Bitcoin (BTC) and the broader cryptocurrency market gave a mild bounceback despite some negative sentiment in the market. As of press time, Bitcoin (BTC) is trading 2.72% up at a price of $27,382 and a market cap of $530 billion.
Other altcoins like Ethereum (ETH) and the top ten have also gained anywhere between 3-4% over the last 24 hours. However, investors still need to maintain caution as weekly trading volumes for some of the top digital assets have dropped to historically low levels. On-chain data provider Santiment reported:
The largest assets in #crypto are seeing historically low levels of weekly trading volume. #Altcoin volume, in particular, has really dried up. When combining just $BTC & $ETH volume, this is the 2nd lowest threshold we are seeing since September, 2019.
Thus, it will be interesting to see whether Bitcoin and other altcoins will continue the rally. For the Bitcoin price to confirm the bullish momentum going ahead, it must give a closing above $27,640 levels.
To confirm a bullish breakout, you want #Bitcoin to print and sustain a 4-hour candlestick close above $27,640! https://t.co/FP1Nd75Bfb
— Ali (@ali_charts) May 23, 2023
Crypto Market Sentiment Overall Negative
After a strong rally earlier this year, crypto assets have once again come under selling pressure. Bitcoin has faced multiple rejections at $30,000 over the last few weeks.
Last week saw the fifth consecutive week of outflows from the crypto market. A total of USD 32 million flew out of cryptocurrency investment products. Crypto analytics firm CoinShares reported:
Volumes totalled US$900m for the week, 40% below this year’s average. Volumes for the broader market on trusted exchanges hit their lowest level since late-2020 at US$20bn for the week.
The total outflows of USD 33 million (last week) from Bitcoin investment products represent the most negative sentiment as over the last five weeks. The combined outflows in the BTC investment products over the last five weeks stand at US$235m.
There could be multiple reasons behind the current negative market sentiment. One could be the concerns over the US defaulting on its debt. JPMorgan chief Jamie Dimon recently said that there could be a major crash in the market if the debt talks go wrong.