Bitcoin (BTC) starts a new week with some fresh hope for hodlers after halting what has been the longest weekly downtrend in its history.After battlin
Bitcoin (BTC) starts a new week with some fresh hope for hodlers after halting what has been the longest weekly downtrend in its history.
After battling for support throughout the weekend, BTC/USD ultimately found its footing to close out the week at $29,900 — $450 higher than last Sunday.
The bullish momentum did not stop there, with the pair climbing through the night into June 6 to reach multi-day highs.
The price action provides some long-awaited relief to bulls, but Bitcoin is far from out of the woods at the start of what promises to be an interesting trading week.
The culmination will likely be United States inflation data, this itself a yardstick for the macroeconomic forces at world globally. As time goes on, the impact of anti-COVID policies, geopolitical tensions and supply shortages is becoming all the more apparent.
Risk assets remain an unlikely bet for many, as central bank monetary tightening is seen to be apt to pressure stocks and crypto alike going forward.
Bitcoin’s network fundamentals, meanwhile, continue to adapt to the surrounding reality and its impact on network participants.
Cointelegraph takes a look at five factors to bear in mind when charting where BTC price action may be headed in the coming days.
Tenth time’s the charm for BTC weekly
It was a long time coming, but Bitcoin has finally closed out a “green” week on the weekly chart.
BTC/USD had spent a record nine weeks making progressively lower weekly closes — a trend which began in late March and ended up being the longest ever in its history.
On June 5, however, bears had no chance, pushing the pair to $29,900 before the new week began, this still being approximately $450 higher than the previous week’s closing price.
That event sparked several hours of upside, with local highs totaling $31,327 on Bitstamp at the time of writing — Bitcoin’s best performance since June 1.
On the Weekly candle close, Trend Precognition printed a Long signal on the #Bitcoin Weekly chart. Looking for a HH on the Weekly to confirm a breakout. If #BTC rallies, key MA’s should act as technical resistance. https://t.co/NPVL3D27C5 pic.twitter.com/GxwT5zI3gC
— Material Indicators (@MI_Algos) June 6, 2022
While some celebrated Bitcoin’s newfound strength, others remained firmly cool on the prospects of a more substantial rally.
Cointelegraph contributor Michaël van de Poppe eyed the open CME futures gap from the weekend, this providing a lure for a return to $29,000.
“Still expecting this to be happening on Bitcoin,” he told Twitter followers.
“A drop towards the CME Gap at $29K would make a lot of sense before a short reversal towards $31.5K.”
A look at order book data reinforces the friction bulls are likely to face in the event of a continued breakout. At the time of writing, the area around $32,000 had more than $60 million in sell-side liquidity lined up on Binance alone.
For Il Capo of Crypto, a Twitter analytics account well known for its sobering takes on upcoming BTC price action, there was likewise little to feel confident about.
In addition to this:
-Price is basically ranging between 29k-31k. That’s below the main pivot (S/R flip)
-Every move up is corrective and data shows that bulls are being trapped.
We might see a scam pump to $30.7k-31.5k, but the bearish main targets are still very likely. https://t.co/UnmENNNK6z
— il Capo Of Crypto (@CryptoCapo_) June 5, 2022
Nonetheless, the market was not without its optimism.
“Having a plan is more important than guessing the correct direction,” popular Twitter account IncomeSharks argued.
“I think we drop then go up, so I’ll be longing if this happens. If stocks open up green we could rally and I’ll pivot to alts to ride them up. TP level is at $34,000 for now.”
Countdown to U.S. CPI reado
U.S. inflation is at its highest since the early 1980s, but will it continue?
The market will find out this week as June 10 sees the release of Consumer Price Index (CPI) data for May.
One of the benchmarks for gauging how inflation is progressing, CPI prints have traditionally been accompanied by market volatility both within crypto and beyond.
The question for many is how much higher it can go as the aftermath of the Russia-Ukraine conflict and its impact on global trade and supply chains continues to play out.
In the U.S., the Federal Reserve’s interest rate hikes are also under scrutiny as a result of prices surging.
The end of the “easy money” era is a difficult one for stocks and correlated crypto assets more generally, and that pain trend is expected not to end any time soon, regardless of inflation performance.
“Liquidity is going out of the market and what that means is it will have an impact on the equity markets,” Charu Chanana, market strategist at Saxo Capital Markets, told Bloomberg.
“We do expect that the drawdown in the equity markets still has some room to go.”
Chanana was speaking as Asian…
cointelegraph.com