Bitcoin (BTC) is once again capturing the spotlight in the financial markets as the BTC/USD pair hovers near a significant resistance level, showing signs of a potential bullish breakout. After weeks of tight consolidation, the cryptocurrency appears ready for a renewed uptrend, fueled by macroeconomic stability, strong spot ETF inflows, and favorable technical indicators.
This article by the brokers at Gradiopexo delves into the critical drivers and price action dynamics that are positioning Bitcoin for a possible bullish continuation.
Macro Stability Supporting Risk-On Sentiment
One of the main catalysts driving optimism in risk assets like Bitcoin is the recent release of U.S. inflation data, which pointed to a relatively benign consumer price landscape. According to the Bureau of Labor Statistics (BLS), the headline Consumer Price Index (CPI) edged up from 2.3% to 2.4% in May. This was slightly below market expectations, indicating that inflationary pressures remain under control.
More importantly, core inflation, which excludes volatile food and energy prices, stayed constant at 2.8%. This stability suggests that the U.S. Federal Reserve (Fed) may not feel the urgency to hike interest rates aggressively in the near term.
Given that Bitcoin and other cryptocurrencies tend to thrive in low-interest, low-inflation environments, these developments could be laying the groundwork for a crypto-friendly macro backdrop.
Another positive sign for sentiment was the recent geopolitical truce between the United States and China, two global economic powerhouses. Although details remain limited, early signs suggest that the countries are working to de-escalate trade tensions, particularly around export controls on critical commodities such as rare earth elements.
Reduced friction in global trade generally improves investor sentiment, especially in volatile and sentiment-driven assets like Bitcoin.
ETF Inflows and Exchange Supply Trends
While macro indicators remain favorable, the on-chain metrics and institutional demand for Bitcoin provide further reasons for optimism. Notably, spot Bitcoin ETFs, one of the most closely watched investment vehicles in the crypto space, have recorded three consecutive days of net inflows, bringing their total holdings to a staggering $45 billion.
These institutional inflows represent a growing mainstream adoption of Bitcoin, supporting long-term price appreciation.
At the same time, data shows a decline in exchange reserves, a traditionally bullish indicator. Currently, there are approximately 1.1 million BTC held on centralized exchanges, a sharp drop from over 3 million just a few years ago.
This suggests that long-term holders (LTHs) are increasingly moving their coins into cold storage, reducing sell-side pressure and tightening the available supply, an essential ingredient for a supply squeeze that could accelerate an upward move.
BTC/USD Technical Analysis: Bullish Setup Confirmed
A closer look at the BTC/USD daily chart reveals a clear technical consolidation phase that is nearing resolution. The pair is currently trading at around $109,000, just below this week’s peak of $110,400.
This price level also aligns with the upper boundary of a cup-and-handle pattern, a classic bullish continuation formation characterized by a rounded bottom followed by a shallow consolidation handle.
The BTC/USD pair remains comfortably above the 50-day EMA and the 200-day EMA, reinforcing the idea that the bulls are in control. The 50-day EMA, currently around $102,303, serves as a critical dynamic support level, and any sustained break below it would undermine the bullish bias.
Conversely, a clean breakout above the current range could propel the price towards the next key resistance at $115,000, with the potential for a new all-time high in sight.
Additionally, Relative Strength Index (RSI) levels are neutral, indicating that the market is not overbought, leaving room for additional upside. Volume patterns also support the breakout scenario, with a noticeable uptick in accumulation volumes over the past week.
Key Levels to Watch
- Immediate Resistance: $110,400 – Weekly high and psychological barrier.
- Breakout Target: $115,000 – Next major resistance and potential new high.
- Support Level: $102,303 – 50-day EMA and near-term downside invalidation point.
- Long-Term Support: $95,000 – Below the cup base, a breach here would negate the bullish structure.
Conclusion
Bitcoin is poised at a crucial technical inflection point, with mounting evidence suggesting a potential bullish breakout. As macro conditions stabilize, ETF inflows rise, and technical indicators align, the path of least resistance appears to be higher.
While nothing is guaranteed in the world of cryptocurrency trading, the signs currently favor bulls, making this an exciting moment for BTC/USD traders and long-term Bitcoin enthusiasts alike.
