Bitcoin rallies sharply after the weekly close, but it may be “too little, too late for BTC miners.”

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Bitcoin (BITCOMP) begins a new week, hitting major resistance as the shock of the latest US inflation news fades – will the rally last?

The weekly close on July 17 was nearly equal to the previous one, but BTC/USD is exhibiting some much-needed momentum ahead of the July 18 Wall Street morning.

Last week was a test for crypto investors everywhere, with inflation controlling the tone across risk assets and the US dollar capping the grim mood. With those stresses now alleviated — at least momentarily — the mood can relax. At the same time, on-chain data suggests that Bitcoin miners are facing a make-or-break moment, with market capitulation imminent.

All eyes are on weekly moving averages

Those who follow the weekly Bitcoin chart will notice a sense of déjà vu this time: BTC/USD concluded July 17 less than $100 away from where it stood on July 10.

The most recent weekly finish is a letdown in and of itself, with Bitcoin reversing gains at the last second to print a “red” candle for the last seven days.

On the other hand, what followed was a fast overnight march higher, with the largest cryptocurrency adding $1,400 in less than twelve hours.

All of this points to a familiar problem on intraday timeframes: BTC/USD is approaching both $22,000 and a significant trendline in the form of the 200-week moving average at $22,600. (WMA).

Ethereum nears $1,500 in potential trendsetter move

One stimulus that could push Bitcoin beyond its main barrier level of $22,600 may come from an unexpected source: altcoins.

Normally, Bitcoin moves precede those of other cryptocurrencies, but this week, investors are waiting to see if BTC/USD will follow the largest altcoin Ether (ETH-x) higher.

With news that the shift to proof-of-stake (PoS) mining may be completed soon, Ethereum has outpaced in terms of price gains recently, rising 25% in the last week alone. For the first time since June 12, ETH/USD was ready to breach $1,500.

Dollar strength finally flips in Bitcoin’s favor

Regarding macro trends, the picture appears less frenzied than when crypto investors arrived last week.

Inflation data has come and gone, and the argument over whether or not inflation in the United States has peaked has died down until the next Consumer Price Index (CPI) released in August.

Later this month, the Federal Reserve will determine how to combat inflation with crucial interest rate hikes. Meanwhile, the Federal Open Markets Committee (FOMC) will convene only on July 26.

Any macro indications for BTC price action would likely originate elsewhere, with geopolitical triggers high on the list of possible reasons.

Miners dump 14,000 BTC in days

With so much optimism that a trend reversal is imminent, on-chain data showing Bitcoin miners selling inventory appears even more dismal.

Beginning on July 14, miners removed a significant amount of BTC from their reserves, according to data from the on-chain analytics platform CryptoQuant.

As a result, miner reserves fell to their lowest level since July 2021, coinciding with a BTC price low.

On July 18, reserves were 1.84 million BTC, down 14,000 BTC from the previous day.

The results were an optimistic indication for CryptoQuant contributor Edris, indicating that miners were now contributing to establishing a macro BTC price floor.

RSI sparks “very rare” BTC price inflection point

Finally, analysis reveals that an “unusual” event on the Bitcoin chart may have just provided the gasoline for a historic turnaround. Using the BTC/USD chart from the beginning of Bitcoin’s existence, Stockmoney Lizards observed that Bitcoin’s relative strength index (RSI) is presently at appropriately low levels and has merged with a touch of a log chart trendline.

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