Bitcoin’s upside has been limited by increasingly deteriorating macro
conditions as oil prices continue to rise amid escalating tensions in the
Middle East.
The Houthis have
intensified attacks against Saudi Arabia, including a reported strike on an
administrative building at Saudi Aramco’s Dhahran compound. The “energy ceasefire”
between Russia and Ukraine failed to materialise and the US-Iran negotiations
remain at a stalemate.
Without some
easing in those factors, the crypto market might remain under pressure as elevated
yields and oil prices will likely continue to weigh on the risk sentiment.
Today, all eyes will be on the US CPI report. Traders will mainly look
at the core m/m measure as Fed officials have been focusing on the monthly pace
of core inflation to determine how many rate hikes will be needed and how
quickly they should tighten policy.
An uptick to 0.3% might
not be enough for the market to fully expect a hike in October, but a jump to
0.4% should do it. In such a scenario, we will likely see a selloff in Bitcoin
on a hawkish repricing. An in-line or even lower than expected figure, on the
other hand, could lead to a short-term relief rally for the cryptocurrency.
BITCOIN TECHNICAL
ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can
see that Bitcoinhas recently bounced from the
81,500 support zone. If we get another pullback into the support, we can expect
the buyers to step in, with a defined risk below it, to keep targeting a rally
into the 98,000 level. The sellers, on the other hand, will want to see the
price breaking lower to pile in for a drop into the 75,000 level next.
BITCOIN TECHNICAL
ANALYSIS – 4 HOUR TIMEFRAME
On the 4 hour chart, we have
a minor resistance around the 84,200 level. The sellers will likely continue to
step in there, with a defined risk above the resistance, to position for a drop
back into the support targeting a break below it. The buyers, on the other
hand, will look for a break higher to increase the bullish bets into the 87,400
level next.
BITCOIN TECHNICAL
ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, we
have a minor support around the 83,000 level. The buyers will likely continue
to step in around the minor support, with a defined risk below it, to keep
pushing into new highs. The sellers, on the other hand, will look for a break
lower to pile in for a drop into the 81,500 support targeting a break below it.
From a risk management perspective, though, it would be better to wait for the
US CPI, as surprises could trigger big moves and make technical levels useless.
The red lines define the average daily range for today.
UPCOMING CATALYSTS
Today we have the US CPI
report. Tomorrow, we get the US PPI, the US Retail Sales and the latest US
Jobless Claims figures.
This article was written by Giuseppe Dellamotta at investinglive.com.