Bitcoin price drops to $62.5K as trader warns weekly close may spark more losses
Bitcoin price drops to $62.5K as trader warns weekly close may spark more losses. Despite encouraging US inflation data, Bitcoin failed to follow US equities, which closed Thursday's session at all-time highs.
Intelligence analysis by Llama
Bitcoin price drops to $62.5K as trader warns weekly close may spark more losses. Despite encouraging US inflation data, Bitcoin failed to follow US equities, which closed Thursday's session at all-time highs. Markets look to PCE inflation data as the next key test for risk assets.
Imagine you have a big jar of cookies, and you want to keep them fresh. But someone keeps taking cookies out of the jar without putting any new ones in. That's kind of like what's happening with Bitcoin right now. People are taking Bitcoin out of the market, but not putting any new ones in. This makes the price go down. It's like the cookie jar is getting emptier and emptier.
Analysis
Bitcoin Price Drops to $62.5K as Trader Warns Weekly Close May Spark More Losses
Bitcoin has been on a downward trend, ignoring positive US inflation trends while US stocks continue to circle all-time highs. The current price of $62,570 is near its lowest levels month-to-date, and traders are increasingly seeing a BTC price breakdown next.
According to Rekt Capital, a trader and analyst, the weekly close needs to be above $63,220 to avoid a deeper rout. This is because the 50-month exponential moving average (EMA) at $65,827 is back as resistance, copying the 2022 bear market.
The article also mentions that PCE inflation data is the next key test for risk assets. The index's last print in July marked its first monthly decline since 2020, and macro traders are now focused on the Aug. 26 release.
Overall, the article provides insight into the current state of the Bitcoin market and the potential for a deeper rout if the weekly close is below $63,220. It also highlights the importance of PCE inflation data in determining the direction of risk assets.
Bitcoin Price Sags with Stocks at All-Time Highs
Despite encouraging US inflation data lifting risk assets and reducing the odds of interest-rate hikes, Bitcoin failed to follow US equities, which closed Thursday's session at all-time highs. The S&P 500 and tech-heavy Nasdaq Composite Index were both green at the time of writing, up 0.11% and 0.14%, respectively.
The article notes that the range remains intact, but softer inflation data have so far generated only a muted response from crypto. QCP Capital, a trading and investment company, drew attention to this phenomenon in its latest analysis.
PCE Inflation Data in Focus
The article highlights the importance of PCE inflation data in determining the direction of risk assets. The index's last print in July marked its first monthly decline since 2020, and macro traders are now focused on the Aug. 26 release.
Overall, the article provides insight into the current state of the Bitcoin market and the potential for a deeper rout if the weekly close is below $63,220. It also highlights the importance of PCE inflation data in determining the direction of risk assets.
Key points
- Bitcoin price drops to $62.5K as trader warns weekly close may spark more losses
- Despite encouraging US inflation data, Bitcoin failed to follow US equities, which closed Thursday's session at all-time highs
- Markets look to PCE inflation data as the next key test for risk assets
- Rekt Capital warns that a weekly close below $63,220 could set price up for a breakdown
- PCE inflation data is the next key test for risk assets, with the index's last print in July marking its first monthly decline since 2020
If the PCE inflation data comes out better than expected, it could boost the market and make Bitcoin go up. This could happen if the data shows that inflation is under control, and the Federal Reserve doesn't need to raise interest rates as much. This would make people more confident in the market and could lead to a price increase.
If the PCE inflation data comes out worse than expected, it could make the market go down even further. This could happen if the data shows that inflation is higher than expected, and the Federal Reserve needs to raise interest rates more than expected. This would make people less confident in the market and could lead to a price decrease.
