Bitcoin rangebound above $60,000 ahead of US CPI test – Crypto News
Bitcoin determined to hold onto $60,000 handle
But bulls struggle amid lack of upside pressure
US CPI data could decide the next course of action
Crypto markets appear to have entered a more neutral phase after Bitcoin’s highly anticipated halving event on April 20 passed without much fanfare. Bitcoin is leading this range-bound trading among the big digital currencies, as aside from the fact that the halving effect was fully priced in prior to the actual event, there’s been an absence of clear catalysts in the crypto sphere since then.
Interestingly, Bitcoin’s rally stumbled some time before the halving and in the bigger picture, the price has been trending slightly downwards since the middle of March. This coincides with the US dollar’s second leg of the year-to-date uptrend, mirroring a similar move in the 10-year Treasury yield.
![](https://www.xm.com/wp-content/uploads/2024/05/BTC_USD_10Yr.png)
This does suggest that Bitcoin has started to track moves in the dollar much more closely than the developments on Wall Street lately. Specifically, fading expectations about Fed easing, which are behind the dollar’s resurgence, are increasingly a significant drag, becoming more pronounced when the odds shifted to less than two 25-bps cuts.
Geopolitical tensions in the Middle East have been another factor weighing on cryptos, not because they’ve become less attractive as alternative safe havens, but because of the threat of higher oil prices scuppering central banks’ rate cutting plans.
$60,000 tested amid rate cut uncertaintyWhat has also become apparent, however, in all this is that there seems to be little appetite in pushing Bitcoin below the current floor of $60,000. Prices briefly dipped to a two-month low of 56,483.08 on May 1 as investors digested the Fed’s mixed messages from the FOMC meeting. But they quickly recovered as markets concluded that Fed chief Powell has set a very high bar for hiking rates.
If Wednesday’s CPI data don’t surprise to the upside, the chances for a rate hike will become even more remote, while a soft print may even solidify a cut as early as September. This could lift Bitcoin above the short-term descending trendline and towards its 50-day moving average in the $65,000 area. But to revive the positive momentum, a further climb above $65,000 is needed.
![](https://www.xm.com/wp-content/uploads/2024/05/image-1715760036560.png)
However, any further disappointments in US inflation readings could see the critical $60,000 level being breached again, strengthening the bearish forces.
More consolidation?In the event that the incoming data fail to set a clear trend, further consolidation is likely in the near- to medium-term and how the inflation picture is shaped over the summer will be even more crucial for the outlook. And whilst there is a danger that the next time the price falls below $60,000, it triggers some panic selling, many investors remain bullish about Bitcoin in the long term.
One reason for that is the growing dominance of large institutional players in the crypto market since the launch of spot ETFs that is seen as limiting the downside. But despite that much-sought ‘endorsement’, regulatory hurdles have not gone away, and although Bitcoin itself can now be considered to be in a more mature stage, the rest of the crypto industry cannot.
Still, after the impressive gains earlier in the year, a period of relative calm is to be expected and volatility may dwindle further before the next breakout comes.Aset Berkaitan
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