Bitcoin price is showing some positive signs ahead of the upcoming US inflation data and a statement by Fed’s Jerome Powell. BTC has held steady above $60,000 in the past 10 days straight and is slowly showing some positive technical patterns.
Bitcoin price forms a bullish pattern
Bitcoin price has been under pressure in the past few months as it crashed from over $73,000 in March to $56,500 earlier this month. This retreat happened after important news in the industry like the ETF approvals in January and the recent halving event.
On the positive side, there are signs that Bitcoin may be preparing a strong bullish breakout. First, on the daily chart, it has constantly found support at the 10-day Exponential Moving Average (EMA). That is a sign that there are still bulls left in the market,
Second, the coin has formed an inverse head and shoulders pattern, a popular reversal sign. The head of this pattern is at $56,500. Therefore, a break above the slanted neckline shown in green will be a positive sign. It will point to more upside, with the initial target being at $67,265, its highest point on April 23rd. A break above that level will point to more gains to about $70,000.
BTC is seeing strong fundamentals
At the same time, Bitcoin is having some strong fundamentals. First, there are signs that spot Bitcoin ETFs are seeing demand as they had their first weekly inflows in three weeks. The iShares Bitcoin Trust (IBIT) now has over $17 billion in assets while Fidelity’s FBTC has over $9 billion in assets.
Second, there are signs that Bitcoin supply is still under pressure. Most Bitcoin mining companies have seen a dramatic cut in daily production after halving. Bitcoin mining difficulty and hash rate have jumped to a record high.
At the same time, as shown below, while Bitcoin balances on exchanges have risen recently, it remains significantly below the highest point this year. These balances are at 1.75 million, down from the year-to-date high of almost 2 million.
Meanwhile, on-chain data shows some vibrant activity. For example, two whales bought 791 Bitcoins worth about $49.8 million on Monday. One of these whales now sits on coins worth over $309 million while the second one has $35.7 million.
This activity happened a few days after two wallets that have been dormant for over 10.7 years moved Bitcoin worth $60.9 million.
Looking ahead, the next key catalyst for Bitcoin will be the ongoing meme stocks comeback that could push more people to risky assets.
From a macro perspective, Jerome Powell, the head of the Federal Reserve will talk on Tuesday. That speech will be the first one since the Fed left interest rates unchanged on Wednesday.
It will also come as the Bureau of Labor Statistics (BLS) prepares to publish its closely watched consumer inflation data. That report will provide more information on inflation trends and hints on when the first interest rate cut will happen.
