Bitcoin (BTC) struggled to break out after bottoming this past summer below $18,000. BTC followed stock markets lower when Jerome Powell spoke at the annual Jackson Hole conference.
Bitcoin investors wished for prices to decouple from the economy, the central bank, and the stock market. That is not the reality. At current levels, prices are a reflection of cryptocurrency sentiment and the risk appetite. Altcoin Sherpa, who has 182,600 followers, tweeted that 19K is an area of interest for BTC. The traders cite support levels using various horizontal lines.
BTC traders should watch for prices to bounce in the $19,000 to $20,000 level. It needs to break out above $20,000 and trend higher. As prices rise, bullish sentiment will strengthen. Ethereum (ETH) is following a similar trajectory. Although they have more volatility, Dogecoin and Binance Coin are following BTC prices.
As much as traders would like to deny it, Bitcoin’s breakout depends on economic conditions. Stronger job figures indicate a hot economy. Rising GDP suggests strong demand. Both are data points that point to higher inflation. Inflationary pressures need to ease before BTC holds a rally. Interest rates will rise again this month when the Fed raises rates.
Wait until the interest rate cycle moderates before placing any major bets.
