What awaits cryptocurrencies in the summer?

May was the first month of the year that Bitcoin closed with a loss in value. On January 1, BTC was trading at about $16.5 thousand, on February 1 – $23.13 thousand, on March 1 – $23.15 thousand, on April 1, the bitcoin rate reached $28.5 thousand, and on May 1 – $29.3 thousand. On the last day of spring, the price of the asset dropped to $27.7 thousand.

Despite the decline in the price of the first cryptocurrency by 5.5% in May, it has grown by 67% since the beginning of the year. The total market capitalization of the cryptocurrency for May decreased by 3.3%, but has grown by 41% since the beginning of the year.

Interviewed RBC-Crypto experts summed up the results of the past month on the crypto market, gave forecasts for June and named several assets that could show growth in the near future.

“We did not see a strong collapse”

The past month in the crypto-currency market was mainly in the decline in prices for leading assets, said Viktor Pershikov, an analyst of the crypto-currency market. He clarified that the growth was observed only in individual projects, such as Ripple, and was primarily due to internal fundamental reasons.

Otherwise, the correction in the cryptocurrency market as part of the uptrend at the beginning of the year continues, and it is not necessary to say that the market has found the bottom and will go into active growth, the expert says.

The head of RBK Trading LTD, Vladimir Chirpichinikov, shares a similar opinion, noting that May was not very successful for BTC this year, with an almost 6% depreciation. Despite this, we did not see a strong collapse as it was in May of the previous few years, the expert says. According to him, over the past month, BTC and other major cryptocurrencies by market capitalization have been in the process of consolidation.

On May 25, the price of the first cryptocurrency updated for at least 2 months, dropping to $25.8 thousand. But by the end of May, bitcoin “got out of the hole it fell into” and confidently crossed the $27 thousand mark, notes Artem, head of the analytical department at AMarkets Deev. However, then we again saw a smooth decline – now the main cryptocurrency is trading below $26.9 thousand.

This weakening can be attributed to market instability due to problems in the US banking sector, the analyst said. A recession inevitably leads to an increase in the cost of loans for individuals and companies, and investments lose their profitability. Therefore, investors tend to invest in conservative instruments, and the cryptocurrency traditionally fades into the background at such moments, Deev explained.

He also drew attention to the fact that a similar situation with Ethereum — $1.9 thousand at the end of May, and then a decline. Now ETH quotes are below $1.8 thousand, and the trend is down, the expert says.

“Weak month for bitcoin”

The US Treasury is actively working to reduce inflation, and if this succeeds, then the cryptocurrency market segment will go up again, Deev believes. He noted that even if the current Fed rate is maintained, Bitcoin will be able to stop the fall and even begin to rise in price, albeit slowly. The same will happen with Ethereum and other popular cryptocurrencies, the analyst added.

Historically, June is considered a weak month for bitcoin – for the last 3 years in June, its rate has been falling, Chirpichinikov recalled.

According to him, the most important key events for the crypto market in June are reports on the US index of business activity, inflation and unemployment, which are published at the beginning of the month. Further after these reports, on June 14 there will be a meeting of the Fed on the interest rate, a change in which can greatly affect the rate of BTC and altcoins.

In case of good economic reports, the current level of the rate can be expected to be maintained, the expert believes. In this case, according to Chirpichinikov, this will be a positive signal for the crypto market, which will push the price of BTC up to the current resistance level of $31,000, and possibly higher.

According to Pershikov, in May, bitcoin was supposed to show a decrease in BTC to the level of $25,000, but it did not reach this goal a little. At the same time, as in the case of bitcoin, the expert also expects prices for other assets to decline in June.

For example, the correction target for Ethereum is at the level of $1.6 thousand, other assets with high market capitalization, such as BNB, XRP, ADA, MATIC, may also decrease by 5-15% over the first month of summer, the analyst believes.

The expert noted that bitcoin against this background can not only reach the level of $25 thousand, but also go even lower, and the region of $22 thousand. At the same time, such a decrease should not be considered as the beginning of a major collapse, explains Pershikov. Based on the timing and cycles, the expert expects the second half of the year to be bullish, so the decline in cryptocurrency prices can be used to buy assets at better prices.

As for the fundamental aspects, the attention of market participants remains riveted to the macroeconomics in the US, reminds Pershikov. According to him, the pause in raising the rate at the June meeting of the Fed is already included in prices, but in case of a discrepancy with market expectations, the cryptocurrency may decrease in sync with stock assets.

“Litecoin halving is just around the corner”

Among all the crypto-currency assets of their TOP-30, Litecoin (LTC) may turn out to be stronger than the market, in the network of which a halving will take place in August, historically bullishly influencing the rate of cryptocurrencies, says Pershikov. He noted that LTC may become one of the leaders in the subsequent market growth, even if it does not show outstripping dynamics in June.

Vladimir Chirpichinikov also paid attention to LTC. Since the halving is “just around the corner”, the price of the cryptocurrency will actively grow this month and next, the expert says.

He also pointed out that several major crypto unlocks are expected in June, such as 1inch Network (1INCH) (16.6% of the entire offer will be released) and Blur (BLUR) (6.62% of the total offer) . The expert warned that after unlocks, as a rule, there is a fall in the price of assets.