Bitcoin has dropped below $ 21,000, but the overall trend remains positive as the cryptocurrency market awaits the US CPI this week.
Bitcoin rose sharply on Friday and Saturday last, reaching $ 21,465, its highest level since September 13, before faltering on Sunday.
Remember, Bitcoin benefited Friday from the announcement of the higher-than-expected US unemployment rate, despite strong job creation, which raised the chances of a 0.5% rate hike for December in the eyes of the market, to the detriment of upward quotas. .
This has increased investor risk appetite, not only on cryptocurrencies, but also on exchanges, which explains why Bitcoin climbed to nearly $ 21,500 on Saturday morning, up about 5% from $ 20,200 on Friday morning.
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Bitcoin and US Consumer Price Index
The main focus of the market this week will be on US inflation data.
A higher-than-expected CPI could also support expectations for a 0.75% Fed rate hike in December, while lower-than-expected inflation would raise expectations for a limited rate hike of 0 and 5%.
For now, the official consensus of economists predicts annual inflation of 8%, up from the previous 8.2%. The annual core CPI, which excludes food and energy, is expected to come in at 6.5% after the previous 6.6%.
Technical limits to keep an eye on on Bitcoin
From a graphical point of view, it should be remembered that last Friday Bitcoin sent a strong long-term bullish signal, surpassing its 100-day moving average which in the previous days acted specifically as resistance, as seen in the daily chart below:
The correction released on Sunday did not bring bitcoin back below the 100-day moving average, which is currently at $ 20,642, so the positive bias is not in question. On the other hand, breaking this limit would directly expose the key psychological threshold of $ 20,000.
In the short term, the hourly chart shows a close relationship between prices and the 100-hour moving average of the past few days. It is currently approaching $ 20,885 and this 100-hour moving average is immediate support for Bitcoin at the time of writing.
Finally, on the upside, $ 21,000 and $ 21,500 are the top two hurdles to consider in the BTC / USD pair.
