Bitcoin (BTC) is still going through a period of uncertainty. A bounce from Tuesday has already faltered, and there is a risk the price could return to the $109,000 local low. Some kind of a spark is needed. Could this come from the US stock market.
Buoyant US stock market + rate cuts = the spark that ignites Bitcoin?
Source: TradingView
The weekly chart for the S&P 500 shows how the Index has staged a spectacular recovery from the Trump tariffs plunge. Now the price is back above the lower trendline of the rising channel and is making new all-time highs with regularity.
At the bottom of the chart, first the Stochastic RSI has its indicators bouncing along the top, and then the MACD just below, reveals the indicator lines coming back to the same elevated position they were through much of 2024.
A rate cut is likely coming in September, but this said, history proves that the Federal Reserve is always behind the curve on cuts, and that once these begin, it is usually too late to stop the rot in an economy that is already well into decline.
Nevertheless, with President Trump usurping control of the Federal Reserve, rate cuts could come thick and fast. This, combined with potential government money printing going into overdrive, could be what Bitcoin needs to complete its bull market with a bang.
$BTC confirms $112,000 as resistance
Source: TradingView
Unless you are a trader, getting involved in the minutiae of the $BTC price in the short-term time frame is probably not advised. Suffice to say that $BTC is generally going sideways, and that it is coming to the bottom of this sideways range once again. Until such time as it definitively breaks down through $109,000, or it breaks the descending trendline to the upside, there is not much to do except wait it out.
Of course, there is the worry that this last little upside move may have just been to confirm the breakdown of what was once support at $112,000. If so, a lower low from here will do much to add credence to the bear case that $BTC is going to go a fair bit lower.
Daily indicators suggest a bounce is near
Source: TradingView
Judging by the view of the daily chart, the $BTC price is still at a very good level of support. The Stochastic RSI indicators are close to the bottom again, and the Relative Strength Index has its indicator bouncing along the 40.00 level, which has acted as strong support in the past. Each time the price has been down to this level, or has passed through it, a strong bounce has usually followed.
$109,000 is strong price structure support
Source: TradingView
The weekly view of the $BTC price shows that it is still nicely balanced on top of the previous range. As long as the price holds above here, all looks perfectly fine. It might be that there could be more sideways movement in order to further strengthen the structural price base for the next move higher.
The Stochastic RSI indicators on this large time frame are possibly only a week or two from hitting the bottom. When it comes to it, the price action has held up remarkably well so far for this reset of the indicators. On the other hand, when the indicators swing up, they usually provide some excellent price gains. Will it be the case this time?
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
Credit: Source link
