Bitcoin, currently trading at $76,707.42, has dropped 3% in morning trading in Asia, hovering around $77,000 as the market prepares for a week filled with significant macroeconomic events. This movement appears to be driven by caution rather than a change in market sentiment. According to Enflux, a Singapore-based market maker, traders are hesitant to push bitcoin prices higher ahead of the upcoming rate decision and data releases, including GDP, PCE inflation, and the Employment Cost Index, which will shape expectations for potential rate cuts by the Fed in the second half of the year.
The primary constraint at present is oil, with Brent crude prices remaining above $100, complicating the inflation outlook and making it more challenging for the Fed to adopt a dovish stance. Enflux notes that the market is operating under two competing assumptions: that geopolitical tensions will eventually ease, but not quickly enough to influence near-term policy, effectively pricing out rate cuts for June and creating an ambiguous backdrop for risk assets. As a result, bitcoin has struggled to break above key technical levels, trading roughly 4% below its short-term holder cost basis near $80,700, a level often seen as a proxy for marginal buyer conviction.
A decisive move above this level would likely require a clear signal from the Fed that oil-driven inflation is temporary. In the absence of such a signal, Enflux expects bitcoin to trade cautiously into Thursday's data releases, with a sharper move more likely tied to the macro prints than the Fed statement itself.
Looking beyond this week, the reported slowdown in AI demand, as indicated by OpenAI missing key revenue targets, may also shape bitcoin's next moves. Listed BTC mining companies have taken on significant debt to pivot to hosting AI data centers, a venture believed to be more profitable than mining. A slowdown in this pivot could potentially slow selling, as miners may have less incentive to sell BTC to fund capex and service debt. However, the timing of this slowdown is crucial, as sell pressure on semiconductor and data stocks due to weaker tech and risk appetite would likely bring down the crypto market, while any relief from slower miner selling would come later.
In this sense, the AI story reinforces Enflux's broader point that the market is caught between competing macro forces, and any slowdown in AI demand adds another layer of uncertainty without immediately resolving the key issues affecting price. For now, this keeps bitcoin trading within a narrow band, waiting for a clearer signal.