Bitcoin price returned above the $60k mark on Tuesday, with its daily gains standing at 1.3 percent. The crypto bellwether has gained 5.9 percent in the last week, but has struggled to find its footing above the psychological round figure mark. Events in recent days have proven that cryptos are not as detached from the mainstream financial markets as they were in the years past. Last week’s sharp drop in the stock markets, followed by sharp recovery was reflected in the global cryptocurrency market.
The approval of Bitcoin and Ethereum spot Exchange Traded Funds (ETFs) earlier this year increased the degree of integration between the crypto market and the mainstream economy. With that in mind, the near-term changes in Bitcoin price will likely be impacted by the economic data that could influence US interest rate decision making. With that in mind, the immediate source of volatility will likely be Wednesday’s release of the July Consumer Price Index (CPI) figures.
Softer inflation figures could boost Bitcoin price, as it could increase the likelihood of higher interest rate cuts from September, and avert fears over possible recession. Conversely, a rise in inflation will embolden the Fed to avoid aggressive cuts, which could inject an element of uncertainty regarding the performance of the US economy in the second half of the year.
The momentum on the 2-hour BTC price chart signals that the buyers are in control. The price is above the 20-SMA and the 50-SMA. A move above the psychological round figure of $61,000 would create a key support level. A move by the 20-SMA above the 50-SMA could sustain the upside to break above that mark. Meanwhile, the RSI is at 61, signifying that the buyers could be taking control of the market.
The upward trajectory will likely continue if BTC price stays above the 59,410 pivot mark. With that, the first resistance will likely be at 59,998. However, a break above that mark will strengthen the upside trajectory to potentially test 61,500. On the other hand, movement below 60,240 will favour the sellers to take control. In that case, the first support could come at 59,548. However, extended control could breach that mark, and make the upside narrative invalid. Also, it could result in further decline to test 58,851.
This post was last modified on Aug 13, 2024, 18:01 BST 18:01