Big Week Ahead For Bitcoin And Crypto: This Will Be Crucial
Bitcoin and crypto markets saw a strong weekly close. Bitcoin price surged straight up towards the current key resistance at $28,600. After seven failed attempts, this puts the price back just below the current key level separating BTC from $30,000.
A powerful price move will also benefit the wider crypto market as the rotation in altcoins, also known as altcoin season, has yet to materialize. Bitcoin and crypto investors should therefore keep an eye on key macro data in the coming week.
Bitcoin and Crypto Face These Major Events
After a quiet start to the week, one of the most important macro metrics for financial markets arrives on Wednesday, April 12th, with the US Consumer Price Index (CPI). When the CPI data is released at 8:30 am EST, expect to see more volatility in the Bitcoin and crypto markets.
Investors will be weighing whether the Federal Reserve can move forward with another rate hike or whether it will hit the pause button in the face of a stronger-than-expected drop in inflation combined with the latest US labor market data. The prior month CPI was 6.0% year-over-year (YoY) and 0.4% month-over-month (MoM).
In March, CPI YoY expectations are at 5.2% and 0.3% (MoM). A failure in expectations is likely to push the Bitcoin price lower as markets price in a higher likelihood of another Fed rate hike in May.
CME’s FedWatch tool currently shows a 61% probability of a 0.25% rise in rates in May. If expectations are met or even exceeded, Bitcoin is likely to head north.
Later that day, on Wednesday, the FOMC minutes will be released at 2 pm EST. Minutes of the meeting will reveal more details on the Fed’s projections and considerations for the latest rate decision. This makes Wednesday the most important day of the week.
On Thursday, April 13, both the US Producer Price Index (PPI) and Initial Jobless Claims will be released at 8:30 am EST. PPI MoM is forecast to reach 0.0% (previously -0.1%) while core PPI MoM: is forecast to rise again to 0.3% (previously 0.0%).
Initial jobless claims are forecast at 216,000, up from 228,000. Already last week, the US labor market and private sector ISM Purchasing Managers Index numbers showed small cracks in the US economy, while (the lagging indicator) the US unemployment rate sent a mixed signal and fell marginally (from 3.6% to 3.5%).
On Friday, April 14, at 8:30 am, US retail sales will be released. March Retail Sales are expected to decline 0.5% MoM (previously -0.4%) while Core Retail Sales are expected to be down 0.4% MoM (previously -0.1%). The data must be seen in the context of slowing economic growth and fears of recession.
At press time, BTC price was trading at $28,258. A daily or even weekly Bitcoin close above $28,600 would be extremely bullish.
Featured Image from iStock, chart from TradingView.com