Bitcoin Bulls Face Resistance at $110,000
On July 9, Bitcoin made a notable attempt to break the $110,000 barrier, but selling pressure thwarted its advance. The cryptocurrency peaked at $109,777 on Bitstamp before reversing, trapped within a narrow range where order-book liquidity has thickened significantly. Currently, bids and asks are strongest at approximately $108,500 and $110,500, respectively, creating a challenging environment for bullish traders.
Market Dynamics and Trader Sentiments
As traders analyzed the current state of the market, there was anticipation that Bitcoin was gearing up for a significant movement. Investor sentiment leaned towards optimism, with many believing that if Bitcoin could clear $110,000, it might set the stage for a rally towards $130,000. Popular trader Jelle pointed out that most liquidity is concentrated above $110,000, making current stop-loss positions precarious. The bullish flag pattern seems to support this outlook.
Meanwhile, fellow trader BitBull highlighted the importance of the relative strength index (RSI) in determining Bitcoin’s trajectory. He noted that both the 3-day RSI and price are demonstrating an inverse head and shoulder pattern, a classic signal of a bullish trend. According to BitBull, for a breakout to occur, Bitcoin needs either a sustained close above $110,000 or an RSI above 70. Achieving either of these could trigger an upward rally lasting three to four weeks.
Volatility Triggers on the Horizon
As macroeconomic factors persist, upcoming financial indicators are poised to influence the crypto landscape. With the ongoing U.S. trade-tariff situation, the upcoming Consumer Price Index (CPI) report is particularly noteworthy. Analysts from QCP Capital pointed out that the CPI print could sway market expectations for Federal Reserve interest-rate cuts, potentially altering investor sentiment as inflation continues to be a dominant narrative.
Last week’s strong jobs data considerably reduced optimism for rate cuts, prompting a reassessment of projections for cuts in 2025. Interestingly, the anticipation surrounding a potential rate cut in July has all but evaporated, with odds for a September reduction slipping from 90% to 70%. Despite these uncertainties, Bitcoin has maintained a solid bid, buoyed by the persistent weakness of the U.S. dollar and ongoing institutional investments. However, analysts warn that a more hawkish Fed, alongside tightening liquidity conditions amid a reignited trade war, sets the stage for potential market volatility.