Financial markets were dominated by narrow fluctuations on Monday ahead of the release of several macro data this week.
The three major U.S. stock indices closed mixed, with the Nasdaq up 0.21%, the Dow down 0.36%, and the S&P flat.
According to Bitpush data, Bitcoin fluctuated around the $59,000 support level on Monday, hitting a low of $57,700 in the early morning and a high of $60,760 around noon. As of press time, BTC was trading at $58,933, up less than 1% in 24 hours.
Altcoin had a strong week on Monday, with 90% of the top 200 tokens by market cap seeing gains.
SATS (1000SATS) led the gains, up 24.8%, followed by Curve DAO Token (CRV) and Dymension (DYM), up 23% and 17.9%, respectively. MANTRA (OM) led the decline, down 7.2%, while Golem (GLM) fell 5% and ZetaChain (ZETA) fell 2.2%.
The current overall market value of cryptocurrencies is $2.09 trillion, and Bitcoin’s market share is 55.7%.
Traders uncertain about U.S. inflation data
This week’s release of U.S. consumer price index (CPI) and producer price index (PPI) data is expected to provide guidance on the size of the Fed’s first rate cut in September. The U.K. is also expected to release its July CPI data on August 14, while Australia’s consumer confidence index, which tracks household financial sentiment, and Japan’s PPI, a measure of price changes for traded goods within the corporate sector, are due on August 13.
Capital markets commentator Kobeissi Letter claims that the labor market, one of the main drivers of the recent Bitcoin price plunge, “is weakening.” In an August 12 post, Kobeissi said the consumer confidence index “fell to 34.1 in July, the lowest level since March 2021,” indicating that Americans are the most pessimistic about their ability to find a new job in three years.
Kobeissi noted that the ratio of job openings to unemployment will drop to 1.2 by 2024, down from 2.0 in 2022, meaning that “the labor market is no longer tight.”
Regarding the important data this week, some people believe that retail sales and first-time claims data may be more important than PPI and CPI inflation data, because downward inflation has become a market consensus, and the decision on whether the Federal Reserve will cut interest rates by 25 basis points or 50 basis points in September will mainly depend on the economic situation.
Mixed economic signals have made market participants uncertain about the direction of the market. According to the latest CME "Fed Watch" data, the probability of the Fed cutting interest rates by 25 basis points in September is 52%, and the probability of cutting interest rates by 50 basis points is 48%.
References to past cycles
TradingView analyst TradingShot said: “Bitcoin has experienced a sharp drop in the past two weeks, resulting in a test of the 1W MA50 (blue trendline), which, as explained in previous analysis, has only happened once in a bull cycle.”
He added: "As today's view suggests, however, the factors that have recently led to mass panic and liquidations can be seen as a technical attempt by the market to recalibrate the very aggressive bull run prior to March back toward the average level of past cycles."
TradingShot said: "More specifically, in the past two cycles, as shown in the figure, 630 days after the bottom of the cycle, Bitcoin was trading slightly below its 0.236 Fibonacci retracement level, while in the current cycle, the recent decline occurred above this level. This means that the current bull run is closer to the trend of the previous two bull runs, but still more powerful. Therefore, we expect BTC to resume its upward momentum and continue to maintain a stronger momentum than in the past, breaking through the 100,000 mark by early 2025, and possibly reaching the -0.618 Fibonacci extension level by next summer, a level reached in all past cycles."
Market analyst Quinten posted the chart below, noting that the current Bitcoin chart has similar developments to the chart in 2020, when some market observers warned that Bitcoin would continue to fall during the outbreak of the COVID-19 pandemic.
“Bitcoin rebounded sharply last week. I would like to see a breakout of $60,000. If that happens, I believe we will see new all-time highs in September/October,” said MN Capital founder Michael van de Poppe in his latest X Bitcoin analysis.
According to Ecoinometrics, a cryptocurrency research platform, Bitcoin prices could return to new highs if they can break above a trendline around $63,000 . The firm wrote in an Aug. 12 post on X: “Bitcoin has fallen below its historical post-halving growth trajectory. If it returns to this range by year-end, we expect a six-figure value for 1 BTC to be very likely.”
Ecoinometrics believes that assuming Bitcoin follows the same trajectory of previous halving cycles, its price could reach over $140,000 during the cycle’s peak in 2025.
Author: BitpushNews Mary Liu
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