BTC Holding Support for Now
Bitcoin is on watch this week following the consolidation we’ve seen following the recent correction lower. The futures market dropped from highs of almost $125k in mid-August to test support at the $108,855 level. While this region holds, the broader bull trend remains in place and focus is on a trend resumption and a fresh move higher. Should we drop below this level, however, risks of a deeper move are seen.
US Inflation On Watch
Given the drop lower we’ve seen in USD on the back of Friday’s jobs data, the macro-backdrop remains supportive for BTC and, for now, risks look skewed towards a fresh phase of buying. However, Thursday’s US CPI data will likely prove pivotal for near-term price action. Indeed, broader market price action suggests that traders are waiting for this data before establishing a more aggressive view ahead of the September FOMC.
If inflation is seen rising again, this should blunt the more dovish market forecasts, preventing USD from droppings sharply. In this scenario, BTC should remain congested and might even drift lower. However, if CPI comes in below forecasts, this should be heavily bearish for USD, leading to a fresh jump in risk assets. Here, BTC should find demand for a fresh move higher as traders cement easing expectations through year-end.
Technical Views
BTC
For now, the market remains underpinned by support at the $108,855 level. Momentum studies remain weak and risks of a break lower are still seen. However, while this level holds, focus is on a recovery and a fresh test of the $121,500 level. Should current support break, however, focus turns to the $100k level next.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.