Bitcoin bulls fight to push the price higher, but bears dominate due to support from US-China trade talks today and the US CPI and PPI inflation data this week. Traders are closely watching the macro events as the Bitcoin price holds near $106K.
Investors also adjust their positions based on seasonality and last week’s unfavorable economic data. Moreover, the Crypto Fear & Greed Index is at 55 (Neutral), up from a low of 46 (Neutral) last week.
Bitcoin Traders Eye US-China Trade Deal, Macro
Bitcoin price is flat today at $105,629 after a volatile last week. Market focus remains on the US-China trade talks, with President Donald Trump announcing that officials from both nations will meet in London later today.
The move comes after a phone call between Trump and Chinese President Xi Jinping last week, raising hopes for investors. The Trump tariff war has rattled markets globally.
Meanwhile, the focus is turning on key US inflation data, with the CPI due on Wednesday and the PPI set for release on Thursday. After the recent jobs report that came in slightly stronger than expected, traders look out for the inflation data to gain more insights on the markets in the coming weeks.
Economists forecast CPI inflation data to come in higher at 2.5%, from 2.3% last month, as a result of the trade war. Also, the PPI data is estimated higher at 2.6%, up from 2.4% last month. This may cause the Fed to cut rates early this year.
Bitcoin Price Action Looks Weak
Popular analyst Benjamin Cowen predicted a Bitcoin price fall below $100K for the short term before a rebound back to $103K-$104K. Despite the retracement from an all-time high, BTC price trend remains bullish.
Moreover, the aggressive buying and holding from companies such as Strategy and Metaplanet, as well as new companies adopting the Bitcoin reserve strategy, prevented any major drop. Metaplanet announced a plan to raise $5.4 billion to buy 210,000 BTC by 2027.
Bitcoin price is successfully holding above the 50-day moving average despite a crypto market crash last week. However, RSI continues to drop, with a reading of 53.50 at the time of writing. This suggests the uncertainty in the market, with the price facing resistance near $106,200. If the price moves above, this will be the key level to watch.
Moreover, the 20-EMA (blue) may cross below the 50-EMA (red) in the coming weeks, as the two move closer. Thus, US-China trade talks and key inflation readings will drive the market direction for this and the upcoming week to the FOMC meeting.
Bitcoin trading in the derivatives market also remains flat currently. The BTC for all at-the-money (ATM) implied volatility (IV) has dropped, which signals low expectations of any major price swings.
