- Bitcoin has experienced a downward trend recently, but there are indications that a reversal might be on the horizon.
- Macro-economic factors and the potential approval of Ethereum ETFs by the U.S. Securities and Exchange Commission (SEC) are influential in this context.
- Experts warn that Bitcoin may not present a significant buying opportunity in the medium term, despite current developments.
Discover how macroeconomic developments and regulatory decisions might trigger a reversal in Bitcoin’s market trends.
Impact of U.S. Economic Data on Bitcoin
As the cryptocurrency market braces for potential shifts, notable analyst and CEO of 10x Research, Marcus Thielen, expects significant developments regarding Ethereum ETFs and their potential effects on Bitcoin. Recently, all six companies applying for spot Ethereum ETFs updated their critical S-1 forms, a key requirement for SEC approval. Coinciding with the anticipated release of a lower Consumer Price Index (CPI) report in the U.S. this Thursday, this development aligns with market recovery expectations.
Ethereum ETF Approval Nears
According to 10x Research’s report titled “Bitcoin: Preparing for Next Week,” potential market recovery scenarios have been laid out. The report highlights that despite recent challenges faced by Bitcoin, two out of three reversal indicators are currently showing upward signals. With the Relative Strength Index (RSI) standing at 38%, there is potential for upward movement in the short term. However, failing to surpass the $60,000-$62,000 range could intensify downward pressures.
Upcoming CPI Data: A Potential Catalyst for Bitcoin
Historically, Bitcoin prices have weakened during August and September. A potential rally triggered by interest rate cuts could bring Bitcoin closer to $60,000, though sustaining above this level might be challenging. The bond market anticipates two rate cuts this year, influenced by low employment data and an unexpectedly high 4.1% unemployment rate. Currently, the U.S. CPI data and the Ethereum ETFs are two major upward catalysts for Bitcoin. These developments could provide a brief market respite, initiating an upward correction.
Conclusion
Looking ahead, past CPI data typically has a negative impact on Bitcoin prices. However, this trend was disrupted in June. With inflation expected to drop to 3.2% or even 3.1%, the forthcoming CPI data on July 11th at 3:30 PM could herald a lower inflation rate, potentially boosting market sentiment for Bitcoin. Meanwhile, the focus on Ethereum ETF approvals among new investors poses a potential threat to Bitcoin. The report underscores the delicate balance between market sentiment and technical indicators. As investors await regulatory decisions on Ethereum ETFs, Bitcoin’s path will likely depend on broader market dynamics and regulatory clarity.
