Bitcoin still faces numerous obstacles

Summary:

Bitcoin has rebounded in the short term, but it still faces headwinds from geopolitical tensions and expectations of interest rate hikes.

Sell BTC-USDT

EXP

Trading

64950.0

ENTRY

62000.0

TGT

66000.0

64854.3 -183.0 -0.28%

Point

Flat

62000.0

TGT

CLOSING

64950.0

ENTRY

66000.0

Fundamentals

The U.S. June CPI, released on Tuesday, fell below expectations across the board, marking the largest monthly decline in six years. This cooling inflation directly reduced the probability of a Fed rate hike in July from 43% to 13%. As a result, assets such as U.S. stocks, gold, and Bitcoin rose collectively, with Bitcoin once approaching $65,000.

Nevertheless, it's reasonable to recognize that the biggest driver of the US June inflation data was the sharp drop in energy prices in June due to the US-Iran ceasefire agreement, with crude oil prices falling by a quarter. Now, the market environment has become complex again. The ceasefire agreement appears more like a fragile truce than a real solution. The US-Iran conflict is escalating, geopolitical risks are facing new uncertainties, crude oil prices have rebounded by 10% in the past two weeks, inflation concerns have not been eliminated, and the risk of a Fed rate hike in September remains.

In summary, geopolitical factors and expectations of interest rate hikes continue to put pressure on Bitcoin's recovery. Moreover, Bitcoin and its ETFs have been subject to continuous sell-offs and capital outflows over the past few months. Furthermore, cryptocurrencies are facing new regulatory tightening in the EU, making it difficult for them to escape their predicament in the short term.

Technical aspects

Bitcoin still faces numerous obstacles_1

From the 1-hour chart, BTCUSD is still consolidating at the bottom. Although there has been a short-term rebound, there is significant resistance above, and the bulls still lack the momentum for a sustained upward push. Over the past few months, funds have continued to flow out, and the bears have clearly dominated. It's difficult to say that the downtrend will reverse until it breaks above 68,000. Currently, Bitcoin's price is once again hovering around its previous high, and the possibility of a renewed decline cannot be ruled out. Support is expected around 62,000.

In terms of trading strategy, one could try shorting when the rebound is weak, selling short around 65,000, with a target around 62,000 and a stop-loss above 65,500.

Trading advice

Trading direction: Short

Entry slots: 64950

Target price: 62000

Stop-loss level: 66000

Downside support levels: 62000/60000

Upward resistance levels: 65500/67500

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