Bitcoin is currently trading at $78,177.51, down 3% in morning trading, as markets prepare for a week of significant macroeconomic catalysts. This move 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 before the upcoming rate decision and data releases, including GDP, PCE inflation, and the Employment Cost Index, which will shape expectations for potential rate cuts in the second half of the year.
The main constraint currently is oil, with Brent crude remaining above $100, complicating the inflation outlook and making a dovish signal from the Fed less likely. 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. A clear signal from the Fed that oil-driven inflation is temporary would be necessary for bitcoin to move decisively above this level. Otherwise, Enflux expects tentative trading into Thursday's data releases, with sharper moves likely tied to macro prints rather than the Fed statement itself. Beyond this week, a slowdown in AI demand could also impact bitcoin's price, as listed BTC mining companies have taken on significant debt to pivot to hosting AI data centers.
If AI growth does not meet expectations, this could slow miner-driven selling over time, removing a source of supply. However, the timing of this relief is uncertain, and any slowdown in AI expansion would add another layer of uncertainty without immediately resolving the current macro forces driving price.