Bitcoin Rallies On Weak USD
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USD Retreating
Bitcoin prices are continuing to grind higher on Friday, benefiting from the USD weakness we’ve seen on the back of yesterday’s weaker-than-forecast US jobs data. BTC futures are back above the $60k mark, carving out a potential triple bottom with strong bullish divergence in momentum studies, suggesting potential for a fuller correction higher here.
Fed Expectations
The shift in USD this week has the potential to help Bitcoin recover if we see USD rate expectations cooling further. Yesterday’s heavy downside miss on the NFP has seen market pricing for a rate hike by year end falling below 80%. This comes at a time when there have been growing questions over the hawkish Fed outlook given the sharp drop we’ve seen in oil prices and the expected impact on inflation.
Oil Prices & Inflation
With oil prices back to pre-war levels, inflation should start to moderate in coming months. If seen, Fed tightening expectations should fall further, putting USD under greater pressure and allowing BTC room to push higher. Looking ahead, any further US data weakness should weigh on rate hike expectations, helping lift BTC. Additionally, any positive US/Iran headlines (especially any news on a deal) should be firmly bullish for BTC and a further drop in oil prices should see USD coming off accordingly as traders scale back inflation/rate-hike expectations.
Technical Views
BTC
The rally in BTC has seen price moving back above the $60k mark, potentially forming a triple bottom at the level. With strong bullish divergence in momentum studies, focus is on a continuation higher here and the chance of a broader reversal higher if bulls can get back above $65,380 near-term.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.