Bullish View
- Buy the BTC/USD pair and set a take-profit at 22,500.
- Add a stop-loss at 20,000.
- Timeline: 1 day.
Bearish View
- Set a sell-stop at 20,500 and a take-profit at 18,000.
- Add a stop-loss at 21,500.
The BTC/USD pair consolidated as investors reflected on the latest American consumer inflation data and as the earnings season started. Bitcoin rose to $21,668, the highest level since July 10th.
Earnings Season and Inflation
The BTC/USD pair rallied slightly last week as investors reflected on the latest American inflation data. The data showed that the country’s consumer price index (CPI) rose to a multi-decade high of 9.1%. It was the highest it has been in more than four decades.
The strong inflation data sent signals that the Federal Reserve will likely go big in the next meeting. In an interview, Fed’s Christopher Waller said that he supported a 100 basis point rate hike in the upcoming meeting.
Bitcoin also reacted mildly to the new bank earnings. Most American banks like JP Morgan, Citigroup, and Morgan Stanley missed analysts' estimates as the industry slowdown continued.
Blackrock, the biggest asset manager in the world, saw inflows of over $69 billion, about $40 billion lower than what analysts were expecting. All companies that published their results avoided talking about Bitcoin and other cryptocurrencies.
The BTC/USD pair also held steady as American stocks rebounded. The Dow Jones, Nasdaq 100, and S&P 500 indices rose by more than 2% on Friday as investors reacted to these results. Bitcoin has a close correlation with US stocks. On the other hand, the US dollar index, declined by more than 0.50%.
The next key catalyst for Bitcoin will be more earnings from the US. Some of the top companies that will publish their results are Bank of America, Goldman Sachs, IBM, Interactive Brokers, and Equifax among others. These results will have an impact on American shares and Bitcoin in extension.
The BTC/USD will react to the important economic data from the US. The key data to watch will be building permits, housing starts, and flash PMIs.
BTC/USD Forecast
The BTC/USD pair rose from last week’s low of 18,940 and reached a high of 21,640. On the four-hour chart, this price moved above the 25-day and 50-day moving averages. It has moved slightly above the 23.6% Fibonacci Retracement level. The Relative Strength Index (RSI) moved from the oversold level to the current 70.
Therefore, the pair will likely continue rising as investors target the key resistance point at 22,500. A drop below the support at 20,000 will cancel the bullish view.
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