The cryptocurrency market experienced a significant drop as this week began, led by macroeconomic fears and Bitcoin’s (BTC) price action. Now, indicators suggest the worst has gone for Bitcoin and cryptocurrencies if CPI data and interest rates come as expected.
In particular, BTC reached support in its tighter price range at $66,000, as previously reported by Finbold. A technical analyst highlighted this zone as an ideal entry point to Bitcoin, which was recently achieved.
Nevertheless, the leading cryptocurrency still trades at $67,875 — slightly below the 30-day exponential moving average of $67,957. Moreover, a strong 4-month resistance lies at $72,000, being a level worth watching in the following days.
BTC/USD daily chart. Source: TradingView / Finbold
Bottom signal: Bitcoin exchange reserves and social volume
In this context, the cryptocurrency trader and analyst Ali Martinez reported that nearly $1 billion worth of Bitcoin left crypto exchange reserves in the last 48 hours, for a total of 14,140 BTC. This movement could indicate a positive sentiment and bullish bias for the near future as investors purchase and secure Bitcoin.
From a social perspective, a parody account spotted a bottom signal related to outflows from the Bitcoin ETFs. Finbold collected similar data from Santiment, showing peaks of “ETF outflow” mentioned on social platforms, with BTC price bottoms.
Recently, these mentions appear to be surging again, as some of the exchange-traded funds (ETFs) registered outflows of $200 million.
ETF outflows social volume and BTC/USD price. Source: Santiment / Finbold
Furthermore, the retail demand for BTC has dropped by 17% while Bitcoin registered low spot trading and on-chain transaction volumes. Technical analysts suggest a positive outlook could fuel a price surge to $100,000 per coin, at a psychological target.
Macroeconomics turmoil: CPI data and FOMC meeting
However, worse-than-expected CPI data and a bearish tone at today’s FOMC meeting could invalidate these analyses.
On that note, the finance market currently expects a 3.5% Core CPI year-over-year (YoY), 100 basis points (bps) below last month’s 3.6% and a 3.4% YoY CPI, equal to May results. The forecasted data is likely already priced in, meaning that better or worse results could impact the markets.
Therefore, crypto investors and traders must remain cautious despite the positive signals of a bottom for Bitcoin.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
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