After a solid monthly close in July, Bitcoin bulls seem to be back in action, determined to push the price towards $25,000 despite various macro uncertainties clamping down volatility.
On Monday, the world’s largest cryptocurrency surged by over 4.20% to trade at $24,112 at press time after stalling in the $23,000 zone over the weekend. Ethereum also pushed higher, posting a 4.53% gain in the past day to trade at $1.801. Polkadot, Solana and Cardano were the most significant gainers in the top ten cryptos by market cap, bagging roughly 8%, 7% and 5.2%, respectively.
This uplift comes after a choppy week that was characterized by concerns over U.S. Speaker Nancy Pelosi’s visit to Taiwan and its ripple effects on the markets. However, a surprisingly strong Jobs report on Friday seems to have spurred buying of riskier assets such as BTC due to its hawkish outlook.
The Fed rhetoric and lingering geopolitical concerns could continue to dictate Bitcoin’s direction, with CPI data from both the US and China expected later this week. According to prominent market analyst “Bitcoin Jack,” the CPI data could come out higher than expected, leading to a high-risk premium and higher unemployment once consumers forcibly consolidate spending to essentials.
“Tightening of financial conditions to match available supply is a must, to prevent CPI from spiralling,” He said. “What the FED doesn’t want to say out loud, but surely knows, is they need a recession to have a chance to control and maintain a stable economy.”
In the meantime, crypto investors are also looking for clues in other markets, with Bloomberg’s Senior Commodity strategist, Mike McGlone, believing that equities now hold the key to risk assets. According to him, Bitcoin and other cryptocurrencies could come out ahead “if equities have bottomed.”
Furthermore, Mike predicts that bitcoin’s recovery may find a catalyst and resume what it’s notable for -outpacing most assets- due to chairman Jerome Powell’s “meeting by meeting.”
“The next meeting is September 21 which leaves plenty of time to assess more data and our bias is that deflating commodities and the global tilt towards recession should lighten the fed rates hike sledge hammer and buoy store of value assets like Bitcoin”, Mike said.
Bitcoin now faces minor overhead resistance of $24,500 but is still trapped in an upward channel which could prove challenging for bulls. “Bitcoin again at the top of its rising channel, NASDAQ also hitting resistance, this week both might pull back; BTC to at least 23.1K, can go even lower if stocks pullback as well. I am expecting higher prices but markets don’t go up in a straight line.” said Former investment banker Pablo Henman “Plan-A”.
However, should the price breach that ceiling, the price could test $25,000 as long as it can continue to print higher lows.