Bitcoin, currently trading at $75,850.41, has dropped 3% in morning Asian trading, hovering near $77,000 as the market prepares for a week filled with significant macroeconomic events. The decline appears to be driven by caution rather than a shift in market sentiment. According to Enflux, a Singapore-based market maker, traders are hesitant to drive bitcoin prices higher ahead of the upcoming rate decision and key data releases, including GDP, PCE inflation, and the Employment Cost Index, which will shape expectations for potential Fed rate cuts in the second half of the year. The primary constraint currently is oil, with Brent crude prices remaining above $100, complicating the inflation outlook and raising the bar for a dovish signal from Fed Chair Jerome Powell.
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 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 sharper moves more likely tied to macroeconomic prints than the Fed statement itself.
Beyond this week, the pace of AI demand may also shape bitcoin's next moves, as reported misses in OpenAI's revenue targets raise questions about the growth of AI demand. 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 have both the incentive and financing to continue building when demand for compute is strong, often leading to continued BTC sales to fund capital expenditures and service debt.
However, if OpenAI's miss signals slower AI growth, the dynamic becomes more complex, potentially easing miner-driven selling over time and removing a source of supply. The issue is timing, as sell pressure on semiconductor and data stocks due to weaker tech and risk appetite would likely impact the crypto market, while any relief from slower miner selling would come later.
This reinforces Enflux's broader point that the market is stuck between competing macro forces, with the AI demand slowdown adding another layer of uncertainty without immediately resolving the key issues affecting price. For now, this keeps bitcoin trading within a narrow band, awaiting a clearer signal.