The BTC/USD pair has recently exhibited significant volatility, retreating from a bullish breakout that initially promised a test of all-time highs. As the technical landscape continues to shift, traders are re-evaluating key levels and signals in light of broader macroeconomic drivers, particularly U.S. Dollar strength and the upcoming inflation data release.
TelaraX brokers present a well-rounded assessment of this matter in the article.
Technical Overview
Almost a month has passed since BTC/USD showed signs of resistance near the $86,215 zone. As discussed in the 14th April outlook, bulls consistently failed to maintain momentum near that level. Although that resistance remained valid at the time, the price action lacked proximity to trigger a practical short opportunity.
However, recent price movements have significantly altered the technical picture. Last week, Bitcoin delivered a bullish breakout through a long-standing resistance area above $95,000. This move was a clear indication of renewed buying pressure and risk appetite in the crypto space.
The breakout led BTC/USD to rise above the psychological $100,000 mark, signaling a momentum-driven rally that seemed poised to challenge the all-time high near $109,000. But despite early optimism and tailwinds from a positive U.S./China trade development, the price could not sustain its upward trajectory.
Current Support and Resistance
Following the breakout, BTC/USD pulled back to find a support level at $101,581, which has now formed a bullish double bottom. This technical formation typically signals a potential trend reversal or continuation, depending on subsequent price action.
The current focus is on the resistance zone between $103,091 and $103,379. This area is shaping up to be a pivotal decision point in the short term:
- A confirmed bullish breakout above $103,379 could trigger a new leg higher, potentially targeting the $106,000–$109,000 range again.
- Conversely, a bearish reversal within this zone might prompt a corrective pullback, making it a possible short setup for nimble traders.
Volatility Drivers: U.S. Dollar and Inflation Data
One of the key drivers influencing BTC/USD at present is the U.S. Dollar, which has strengthened in recent sessions. A stronger dollar often puts downward pressure on risk-sensitive assets like Bitcoin.
The CPI (Consumer Price Index) data from the United States is likely to have a strong impact on the USD. Expectations are for an annualized inflation rate of 2.4%. A significant deviation from this figure could increase currency volatility and impact Bitcoin’s direction:
- A higher-than-expected inflation print might fuel speculation about more hawkish Fed policy, strengthening the USD, and putting Bitcoin under pressure.
- A lower-than-expected figure could weaken the dollar, possibly reigniting bullish momentum in BTC/USD.
It’s worth noting that no major news directly related to Bitcoin is expected today, so the CPI data and dollar moves will likely be the dominant influencing factors.
The key technical levels for the asset include significant support and resistance zones:
- Support Levels:
- $100,000 – a psychological level
- $101,581 – marked by a double bottom
- $98,700 – minor support
- Resistance Levels:
- $103,091 – initial resistance
- $103,379 – breakout trigger level
- $106,000–$109,000 – upper targets if breakout occurs
These levels indicate where the price may find buying interest (support) or face selling pressure (resistance), with $103,379 being a pivotal point for a potential upward breakout.
Broader Market Sentiment and Correlations
The recent pullback in Bitcoin also mirrors a broader shift in global market sentiment, where equities and commodities have shown mixed performance amid growing uncertainty over central bank policies and geopolitical developments.
Bitcoin, often viewed as both a risk asset and an inflation hedge, has been trading more in sync with tech-heavy indices like the NASDAQ-100. This increasing correlation with traditional financial markets suggests that institutional activity and macroeconomic narratives are exerting greater influence on crypto prices.
As such, traders should monitor not just crypto-specific indicators but also equity index trends, bond yields, and global risk sentiment to better anticipate BTC/USD movements.
Conclusion
BTC/USD is in a transitional technical phase, having lost momentum after an impressive breakout. The double bottom at $101,581 has helped stabilize the recent retracement, but the next directional bias will be determined by how the price reacts to the $103,091–$103,379 resistance zone.
The short-term trend is still bullish, but the U.S. CPI data release later today could be a catalyst for volatility. Traders should watch both the technical levels and macroeconomic signals closely before committing to directional trades.
In sum, BTC/USD’s failure to break toward all-time highs, followed by a resilient support test, makes this a key inflection point.
