Bitcoin Price May Retest $20K on US CPI Amid Absence of Soft Landing – Trader
Bitcoin (BTC) could face a retest of $20,000 and the US will fail in its plans for a “soft landing” on inflation, a new analysis says.
In a February 5 YouTube update, Cointelegraph contributor Michaël van de Poppe, founder and CEO of trading company Eight, warned that the flow is heading towards risk assets.
The US is “probably” headed for recession – Van de Poppe
Amid confusion over how incoming US macroeconomic data could affect market sentiment, Van de Poppe says there is a growing chance that the decline seen in crypto and stocks this year could turn bearish.
Bitcoin, for example, saw a 40% gain in January, but like some, he believes a disappointing February is a real possibility.
“I think that people should understand that there is no soft landing, that there is probably a continuation of this downward trend in the markets,” he said of the long-term status quo.
The US, Van de Poppe continued, would “probably have” a recession thanks to the scale of the Federal Reserve’s rate hikes.
Should a comedown begin to emerge, for BTC/USD, a potential retest target lies between $20,000 and $21,000.
Much depends on the outcome of data for the consumer price index (CPI) for January, which is due on 14 February. Should it show that inflation slows less than expected or even disrupts the downward trend, the results could benefit the US dollar while taking the wind out of the risk asset rally.
The US Dollar Index (DXY), as Cointelegraph reported, is currently consolidating after falling 13% since mid-2022, when it hit twenty-year highs.
“In this case, the next week will probably bring a case of the dollar starting to rally, or the following week with the CPI and the PPI, so that’s why it’s very important to keep an eye on this chart,” Van de Poppe added.
Bitcoin Bears ‘Stuck in Cash’
Meanwhile, others discussed the potential for a pullback in BTC prices ahead of a less significant macroeconomic week.
Related: Bitcoin clings to $23.5k as trader says BTC ‘identical’ to 2020 breakout
A higher low would provide a better entry point for longs, popular trader Crypto Tony suggested, arguing that the bear market remained in play
“Although this was the start of a bull market and personally I’m still in the camp we’re not. You can still get a good safer entry on the higher low pullback,” he told Twitter followers on the day.
However, some notable bullish voices were as active as ever, including crypto and market education, analysis and prediction tool, IncomeSharks.
“People still seem to be confused as to why it’s only been up,” it in summary in a tweet on February 3.
BTC/USD was trading at around $23,400 at the time of writing, according to data from Cointelegraph Markets Pro and TradingView, with around 15 hours to go until the US weekly close.
“Just remember that the majority of bulls are still holding and not selling. Bears are stuck in cash. Slowly but surely the bears are jumping in and buying. The stubborn ones continue to short prices further.”
The views, thoughts and opinions expressed herein are those of the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
