Bitcoin (BTC) is currently trading at around $95,800, struggling to maintain levels above $97,000. Concerns arise due to the negative impact of U.S. employment data on risk markets, as well as potential sales of billions in BTC linked to the Silkroad case, which adds to the tension among traders.
In terms of Bitcoin’s performance in January, it has moved away from a low of $90,000 but has not yet surpassed the critical $97,000 level. Recent data on U.S. Producer Inflation did not meet expectations for a downturn, but it did show an increase compared to the previous month. Additionally, strong employment figures released recently add complexity to the situation.
The Federal Reserve has two main functions: job creation and maintaining price stability. After postponing interest rate cuts to combat inflation, the Fed is now facing the consequences in terms of employment. With robust job data and persistent inflation, no interest rate cuts are expected in the upcoming meetings until September.
Looking ahead, unless there is a significant drop in the upcoming inflation report, the macroeconomic landscape may not provide support for Bitcoin’s performance in January. The focus then shifts to January 20, when Trump is set to take office, potentially introducing favorable measures for cryptocurrencies.
If Trump swiftly announces policies that ease pressure on cryptocurrencies, such as facilitating banking relationships with crypto firms, it could lead to rapid price increases. Additionally, the appointment of a new SEC chair without prolonged Senate approval may also support the anticipated rally this month.
Another crucial factor is the potential sale of Silkroad BTCs before Trump assumes office. If the Biden administration proceeds with these sales, traders’ anxieties will mount. However, if no sales occur by Friday evening, a relief rally could follow over the weekend, despite some lingering possibilities of sell-offs.
BTC is currently supported at $95,700, with the potential to push above $97,000 if the closing price remains above this level. However, if it falls back to $92,180, it could lead to a deeper low at $87,500.
It has been 28 days since Bitcoin reached its all-time high, and prices remain remarkably close to that peak. If the bull market continues, a return to six-figure prices is expected soon, with $102,500 becoming a key support level for a new all-time high.
