How will Bitcoin (BTC) price trend develop this week?

Bitcoin started the week with suspense

Bitcoin was shrouded in huge uncertainty at the beginning of the week. Last week, its price briefly exceeded $81,000, and then fell back to around $79,000. Currently, the price of Bitcoin fluctuates around $79,830.

However, market transactions are extremely deserted, or even dead. Trading volume plunged more than 40% today, indicating that fewer buyers are participating in trading in this price range. Still, from a larger macro perspective, the market trend is still bullish.

Bitcoin prices climbed towards $82,000 as the market's probability of a September interest rate cut became 50 - 50. Meanwhile, Bitcoin exchange-traded funds (ETFs) attracted $731 million in inflows, the largest single-day net inflow since January this year. In addition, the correlation between Bitcoin and gold has risen to its highest level in six years. This increasingly close connection has made Bitcoin's movements more closely tied to macro-economic driven capital movements.

News that may affect Bitcoin this week

The core focus of this week is inflation data. If the data is strong (higher than expected), the Bitcoin price may lose support; if the data is moderate (lower than expected), it may push the price to break upward.

Let's sort through the key data that will be released soon. The first is the producer price index (PPI). Core PPI is expected to increase slightly to 0.3% from 0.2% last month. The overall PPI is expected to be 0.4%, up from zero growth in the previous month.

Next is the number of jobless benefits applications, which is expected to be 205,000, which is basically the same as 206,000 last month. If the producer price index is higher than expected, or unemployment benefit claims fall more than consensus market expectations, the Fed will lack a sense of urgency to rush to cut interest rates, which will put pressure on Bitcoin.

But the real blockbuster data is the Consumer Price Index (CPI) to be released later. The core CPI is expected to grow by 0.2% month-on-month and an annualized growth rate of 2.4%, slightly lower than the previous month's 2.5%. The overall CPI is expected to grow by 0.4% month-on-month and at an annualized growth rate of 3.4%, which is the same as last month.

If inflation data falls below these forecasts, the market will price more interest rate cuts. This will provide room for the Bitcoin price to test the resistance level of $81,547 again.

We will also look at the University of Michigan's consumer confidence index. The preliminary reading was 51.0, down from the previous reading of 51.7. Inflation expectations remain at 4.0%. This is crucial: If people are pessimistic about the economic outlook and inflation looks moderate, this combination tends to push up expectations of interest rate cuts. Lower interest rates mean increased liquidity in the market, which is beneficial to Bitcoin.

Technical analysis: What does the chart reveal?

We looked at the technical chart, and the first thing that attracted attention was the key position of $81,547. Bitcoin prices tested the region but failed to hold firm. As a result, the current range between $81,500 and $82,000 is serving as a resistance ceiling.

Once this range is exceeded, the next real test will be $82,951. This point is located on the upper edge of the larger fluctuation range visible on the daily chart.

Source: Tradingview.com

Bitcoin support is at US$78,587. Prices are currently holding above that support, but every time they try to break through $81,000, selling will step in and push the price down.

As long as buyers can maintain prices above US$78,587, the general trend remains positive. If this support falls, the next downside target will be $76,159. And then it's $72,327.

The current momentum is okay, but not strong. The Ultimate Oscillator read 57.80, above the center line, indicating that the buyer still has a slight advantage. The Stochastic indicator was 61.53, and the signal line was slightly higher at 62.08. This suggests that the upward momentum has weakened, but has not yet turned negative.

Overall: As long as the US$78,587 support is effective, Bitcoin still has room to rebound. The form is already in place and only needs to be entered by the buyer.

Bitcoin Price Outlook for the Week

Bullish Path: If price support of $78,587 is maintained and Bitcoin regains $81,547, the next target will be $82,951. Breaking through this level will strengthen the argument for further movement towards the main resistance zone.

Bear path: If Bitcoin falls below US$78,587, the chart shows that the primary downside target is US$76,159. If this position falls, it may expose the target of US$72,327; if selling pressure intensifies, US$65,308 will become a deeper downward target.

Most likely path: Bitcoin prices may first be retested for US$78,587 before choosing direction. Holding this level would keep the range of US$81,547-US$82,951 active; losing it would bring US$76,159 and US$72,327 into view. Given that Bitcoin is currently around $79,830,$78,587 is the most critical level this week.