After the news of BlackRock filing a Bitcoin ETF on June 15th, we saw the cryptocurrency surging in value going briefly from the 25K level to the 31K one. Bitcoin resilience has been remarkable given the recent hawkish repricing in interest rates expectations and the regulatory crackdowns. The struggle to break above the 31K level though suggests that we might be at a point where if the risk sentiment turns negative, Bitcoin can selloff pretty hard. So, it will be important to monitor the fundamentals.
Bitcoin Technical Analysis – Daily Timeframe
On the daily chart, we can see that after the strong rally following the trendline breakout, Bitcoin started to consolidate just beneath the key 31K resistance level. The moving average are still crossed to the upside as the bias remains bullish, but at this point everything can change if the risk sentiment turns negative.
Bitcoin Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see more closely the range created between the 29500 support and the 31000 resistance. The best strategy in such instances is to just sit and wait for a breakout supported by a fundamental catalyst and then go with the flow. Aggressive traders can also “play the range” by buying at support and selling at resistance.
Bitcoin Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see that we have an important mid-level where the price has been reacting to on both the upside and the downside. This may be viewed as the “sentiment line” with the sellers being more in control when the price is below the level and the buyers being in control when the price is above it.
Upcoming Events
Today we have the US CPI report. This is a very important release that can shape the markets for the next weeks. If we the data is above expectations, especially on the core numbers, we should see some risk off sentiment in the markets and Bitcoin breaking lower. Conversely, if the data is below expectations, we should see a positive mood in the market and Bitcoin is likely to break higher. We conclude the week with the US Jobless Claims on Thursday and the University of Michigan Consumer Sentiment on Friday.
See also the video below:
