Crypto markets are eyeing several US macroeconomic events this week that could influence Bitcoin’s price. In 2024, macro developments have regained their effect on crypto assets, marking a shift from 2023, when their impact had largely faded.
Bitcoin (BTC) remains below $60,000, a concerning price drop given the lower highs on the daily chart. The decline comes on the back of market sentiment shifting from fear to extreme fear.
US Macro Events This Week
Given this, investors are paying close attention to upcoming data releases and policy announcements that may impact market sentiment, potentially sparking volatility. With several events on the US economic calendar this week, three stand out as key triggers for potential price swings in Bitcoin and other cryptocurrencies.
Minutes of Fed’s July FOMC Meeting
The Federal Reserve (Fed) will release minutes from its July Federal Open Market Committee (FOMC) meeting on Wednesday, August 21. The release will provide insights into the Central Bank’s thinking regarding interest rates and monetary policy.
Any hints of a dovish or hawkish stance could cause waves in the financial markets, including cryptocurrencies. A dovish tone suggesting potential rate cuts could boost risk on assets like Bitcoin, while a more hawkish tone might lead to a sell-off.
10x Research data revealed a strong correlation between Bitcoin price and inflation trends as the influence of macroeconomics on crypto resumes. As BeInCrypto reported, the Fed kept interest rates steady at 5.25% to 5.50%, aligning with market expectations.
Read more: How to Protect Yourself From Inflation Using Cryptocurrency
After last week’s US CPI (Consumer Price Index) inflation data, traders have fully priced in a 25-basis-point rate cut in September. They also anticipate a 24.5% chance of 50 basis points (bps) move, with futures pointing to over 90 bps worth of easing by the end of 2024.
Initial Jobs Claims
Crypto markets also look forward to Thursday’s weekly report on initial jobless claims. The US Bureau of Labor Statistics (BLS) will use this data to offer a snapshot of the labor market’s health and could influence investor sentiment.
A lower-than-expected number of jobless claims may indicate a strong economy, potentially driving investors towards riskier assets like cryptocurrencies. Conversely, more claims could spark concerns about a slowing economy, leading to a flight to safety and possible declines in Bitcoin and crypto prices.
In hindsight, both crypto and broader financial markets faced a turbulent start to the month, largely due to weaker-than-expected US economic data, especially a disappointing July jobs report. This triggered significant market volatility, driven by growing concerns over a potential recession.
Notably, these concerns have begun to ease, as seen by traditional safe-haven assets like the Japanese yen giving up some of their early August gains. If the economic data released on Thursday, August 22, falls below expectations, Bitcoin could benefit as investors shift back to risk-on assets.
Jerome Powell’s Speech at the Jackson Hole Retreat
Traders and investors also anticipate Fed chair Jerome Powell’s Friday speech at the annual Jackson Hole Economic Policy. Markets will be laser-focused on what Powell has to say in retreat.
The title of remarks from last year’s Jackson Hole economic symposium was ‘Inflation: Progress and the Path Ahead.’ Then, he said policymakers are prepared to hold rates at restrictive levels until they are confident inflation is moving sustainably down to 2%.
Like in 2023, the Friday event will interest traders and investors. Powell will either endorse or push back market pricing as policymakers commit to deciding the next rate move based on data.
Therefore, Powell’s comments on the state of the economy, inflation, and monetary policy could set the tone for market expectations. Traders will be listening closely for any clues about future interest rate decisions, which could influence the direction of Bitcoin and cryptocurrency prices.
Bitcoin Price Outlook Ahead Of US Macro Events
Bitcoin is consolidating within a symmetric triangle. This means the next directional bias will only be revealed after the price breaks out from this technical formation. Based on the Relative Strength Index (RSI) outlook, which measures momentum, BTC could continue range bound for the short term. This is as the RSI remains below 50, suggesting a lack of conviction among the bulls.
The volume profiles reinforce the same supposition, with the bullish and bearish spikes (orange and grey, respectively) showing leeriness from both sides. Similarly, the Awesome Oscillator (AO) position in negative territory with red histogram bars accentuates this thesis.
A break and close below the lower trendline on the daily timeframe could see Bitcoin foray into the demand zone. This would provide late bulls and sidelined traders with another buying opportunity between $53,485 and $57,050.
Nevertheless, if such a move happens and BTC closes below the $53,313 midline, the downside potential could extrapolate Bitcoin’s ability to collect the sell-side liquidity.
Read more: Bitcoin (BTC) Price Prediction 2024/2025/2030
Conversely, a break and close above the upper trendline could encourage more buy orders. Based on the orange spikes of the volume profile, several bulls await to interact with BTC prices above $63,000. Buying pressure above this level could invigorate the upside potential.
Nevertheless, only a decisive candlestick close above $67,000, the midline of the supply zone, would confirm the continuation of the uptrend.
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