BTC Bouncing Back
Following a sharp drop at the start of the week, Bitcoin prices have recovered throughout the week with the futures market today trading back up into positive territory on the week. There has been no discernible shift in the macro backdrop to fuel the recovery this week, as such the recovery appears to be linked to simply to better demand kicking in at the retest of the 108,855 level. The broad bullish outlook in BTC remains valid despite the correction from highs, indeed with some late longs cleared out of the market BTC now has high likelihood of making a fresh move higher given the backdrop of dovish Fed expectations, better political support for crypto and increased mainstream uptake.
US Data & Fed Expectations
Looking ahead, today’s US data (prelim GDP and weekly jobless claims) will be closely watched with any weakness in these readings likely to boost risk appetite on elevated easing expectations. Powell’s recent September easing signal hasn’t caused much of a shift in price action for now. However, if incoming data points miss the mark, traders should start ramping up easing expectations for the months ahead, putting fresh pressure on USD and allowing risk assets to climb higher near-term, creating deeper support for BTC. If incoming US data surprises to the upside, however, this could cap the rally in BTC for now, muddying the near-term Fed easing outlook.
Technical Views
BTC
The correction lower in BTC has stalled for now into a retest of the $108,855 level. With strong support kicking in at the level, focus is on a return to highs and a fresh test of the $121,500 level. Should we break below current support, however, focus will turn to deeper support at the key $100k mark.
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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.