Bitcoin, currently trading at $76,459.53, has fallen by 3% in morning Asian trading, hovering around $77,000 as the market prepares for a week filled with key macroeconomic events. This move seems 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 currently is oil, with Brent crude remaining above $100, complicating the inflation outlook and making it challenging for the Fed to signal a dovish stance.
Enflux notes that the market operates 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 decisive move above this level would likely require a clear signal from the Fed that oil-driven inflation is temporary. Otherwise, Enflux expects bitcoin to trade cautiously into Thursday's data releases, with sharper moves more likely tied to macro prints than the Fed statement itself.
Looking beyond this week, the pace of AI demand may also shape bitcoin's next moves, as reported by The Wall Street Journal that OpenAI has missed key revenue targets. Listed BTC mining companies have taken on significant debt to pivot to hosting AI data centers, believed to be more profitable than mining. A slowdown in this pivot could slow selling, as miners have less incentive to sell BTC to fund capital expenditures and service debt.
However, the timing of this slowdown is complex, and any relief from slower miner selling would come later, reinforcing Enflux's point that the market is stuck between competing macro forces, with uncertainty surrounding AI demand adding another layer of complexity without immediately resolving the key issues affecting price.