Bearish view
- Sell the BTC/USD pair and set a take-profit at 80,650.
- Add a stop-loss at 92,000.
- Timeline: 1-2 days.
Bullish view
- Sell the BTC/USD pair and set a take-profit at 92,000.
- Add a stop-loss at 80,650.
Bitcoin price held steady slightly below the important support level at $90,000 as demand for the coin remained under pressure. The BTC/USD pair was trading at 87,630, down from this month's high of 94,635. It remains much lower than the year-to-date high of 126,130.
Bitcoin Price Remains on Edge Ahead of the BoJ Interest Rate Decision
The BTC/USD pair has remained under pressure this week as demand remains weak. Data compiled by SoSoValue shows that the ETF inflows weakened this week, recording an outflow for the second consecutive day.
Bitcoin price also wavered as investors waited for the upcoming Bank of Japan (BoJ) interest rate decision on Friday. Economists expect the bank to hike interest rates by 0.25% for the first time in eleven months.
A BoJ rate hike is important for Bitcoin and other risky assets because investors took advantage of low Japanese interest rates to invest in risky assets. With interest rates and bond yields rising, there are odds that investors have started to unwind these trades.
The BTC/USD pair will next react to the upcoming US consumer inflation data, which will come out on Thursday this week. Economists expect the report to reveal that inflation remained stubbornly above the Federal Reserve’s target of 2.0% in November this year.
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On the positive side, energy prices are going down, with Brent and the West Texas Intermediate moving below the important support level at $60 for the first time in weeks. Lower energy prices are bullish for cryptocurrencies because they push inflation lower, which leads to more interest rate cuts.
BTC/USD Technical Analysis
The daily timeframe chart shows that the BTC/USD pair has been in a downward trend in the past few weeks. It has dropped from the year-to-date high of 126,130 to the current 87,400.
The pair has moved below the lower side of the bearish flag pattern, a popular continuation sign. It has moved below the 50-day and 100-day Exponential Moving Averages (EMA)
The Relative Strength Index (RSI) and the Stochastic Oscillator have pointed downwards, a sign that bears are prevailing. Therefore, the pair will likely continue falling in the near term, potentially to the next key support level at 80,650.
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