Bitcoin Surges to $110,000 Amidst US Economic Uncertainty

Bitcoin is back at $110,000 after a late surge into the weekly close—how will bulls navigate a brewing US bond crisis and the Fed’s “preferred” inflation data?

As BTC price action dipped below $107,000 before its rebound, traders are eagerly anticipating new record highs against a backdrop of US inflation data and volatile bond markets. Regulatory and economic factors remain pivotal.

“Despite the last-minute recovery, Bitcoin needed a more convincing close to seal the likelihood of further gains,” noted popular trader Daan Crypto Trades.

Bitcoin Price Discovery on the Radar After Rebound

Bitcoin swapped late-weekend weakness for gains into the May 25 weekly candle close, taking BTC/USD above the $110,000 mark. There remains substantial volatility as the week unfolds, with previous all-time highs from January becoming a focal point for traders.

Cointelegraph Markets Pro and TradingView indicate the weekly candle closed at $109,100, just about $200 below the January peak. “A strong continuation is necessary for future gains,” said Daan Crypto Trades, emphasizing trader sentiment.

Bond Yields Meet PCE in Tough Macro Week

The Federal Reserve’s “preferred” inflation gauge underscores the week’s anticipated US macroeconomic readings, amidst fears of rising interest rates. The Personal Consumption Expenditure (PCE) Index is expected to be released soon, feeding into larger economic discussions.

As the market started adjusting, rising bond yields influenced the flow of trade deals. “Rising interest rates are becoming a critical concern,” warned trading resource The Kobeissi Letter, pointing to underlying pressure from recent geopolitical narratives.

Exchange Order Book Trends Signal Bearish Momentum

With bearish signals surfacing, the taker buy/sell ratio has shown a marked decrease, suggesting both buyers and sellers are stepping back. “A cooling in market order aggressiveness is likely ahead,” noted on-chain analytics platform CryptoQuant, indicating potential reduced short-term momentum.

As market participants monitor fluctuations, analysts are urging caution. “The current trend may prompt a test of support near $105K if bearish pressures build,” a recent analysis concluded.

Whale Activity Sparks Speculative Interests

Bitcoin’s volatility has attracted significant speculative interests. For instance, Hyperliquid’s James Wynn has been active, shifting from long to short positions rapidly. His $125 billion long position faced challenges due to tariff discussions, leading to swift trades that have caught market attention.

Wynn’s fluctuations reveal a broader trend where traders are reacting quickly to macroeconomic headlines. “We had a good run gambling on perps,” he stated, highlighting the unpredictable nature of crypto trading.

Funding Rates Indicate Potential for Market Growth

Funding rates across derivative platforms currently appear stable, a positive sign when considering potential price movements. CryptoQuant reflects a cross-exchange Bitcoin funding rate at 0.006 as of May 25, indicating that no over-leveraged long positions are dominating the market.

This stability is feeding into optimism among analysts, with many stating that current conditions resemble those preceding previous all-time highs. “A unique setup is emerging, potential for upward momentum is significant,” said popular trader Jelle.

Conclusion

As Bitcoin continues to navigate economic uncertainties, traders remain optimistic yet cautious. The combination of steady funding rates and notable whale activity sets an interesting stage for potential market movements. The immediate future holds vital economic reports that may impact Bitcoin’s trajectory; hence, vigilant trading is advisable.