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Better US Data

Following a sharp move higher last week, Bitcoin prices have stalled this week as hawkish Fed expectations have side-tracked the rally. A raft of better-than-forecast US data his week has pushed back against those warning of an imminent US recession. Soaring new home sales and rising consumer confidence saw traders eyeing further rate hikes from the Fed given the still robust health of the US economy. Durable goods were also seen rising last month, beating market estimates.
 

Hawkish Fed Comments

Alongside better US data, comments from Powell this week leaned firmly on the hawkish side. The Fed chairman noted that July is very much a live meeting in terms of rate-hike chances and refused to rule out the prospect of further consecutive rate hikes this year, despite having paused tightening this month. Powell noted that while the bank has come a long way with rate hikes, the policy still might not be restrictive enough, and with that, further rate hikes might still be warranted.
 

Bullish View

With yields rising and traders looking ahead to further hikes, Bitcoin prices have lost upside momentum for now though, longer-run, the focus is still on a gradual recovery. Additionally, should inflation continue to fall, and the Fed ends up pausing for longer, this should allow BTC and other crypto assets to move higher near-term.
 

Technical Views

BTC

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The rally in BTC has stalled for now around the $30k mark and the prior 2023 highs, just ahead of bigger resistance at the 32185 level. With momentum studies bullish, however, and with price still above the 27415 level, the focus remains on a further push higher near-term with 37030 the longer-run target. 

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