Summary
- Bitcoin fell as low as $77,670 intraday before recovering to $79,181.02, leaving it up nearly 2% over the past week.
- Markets are bracing for bigger swings ahead of the Federal Open Market Committee (FOMC) as investors await the PPI and CPI and price in about a 60% chance of a Fed rate hike.
- Institutional money remains firm, with about $1 billion flowing into U.S. spot Bitcoin exchange-traded funds (ETFs) for a third straight week, though potential profit-taking may emerge near the top of the recent range because 71% of Bitcoin supply is now in profit.
Forecast Trend Report by Period
Bitcoin rebounded after falling below $78,000 intraday, with investor focus shifting to inflation data due ahead of next week's Federal Open Market Committee meeting.
As of 1:56 p.m. in Korea on September 9, Bitcoin was trading at $79,181.02 on Binance's USDT market. It had dropped as low as $77,670 in the prior session before recovering on renewed buying. The cryptocurrency was little changed over the past 24 hours, but has gained nearly 2% over the past week.
Macroeconomic uncertainty appears to be capping Bitcoin's upside. Rising tensions in the Middle East pushed Brent crude close to $100 a barrel, while gold traded around $4,407 an ounce.
U.S. Treasury yields also remained elevated. The 10-year Treasury yield hovered near 4.8%, while the two-year yield stood above 4.3%. CME FedWatch data showed markets pricing in about a 60% chance that the Federal Reserve will raise its benchmark interest rate next week.
Jasper De Maere, an over-the-counter trader at Wintermute, said the market is being driven more by interest rates than by crypto-specific catalysts. He added that the final macroeconomic readings due later this week, ahead of the Fed's rate decision, could fuel further volatility. In the near term, he pointed to $75,000 and $82,000 as key levels ahead of the September 15-16 FOMC meeting.
Markets are watching the U.S. producer price index due on September 10 and the consumer price index due on September 11. Core CPI is forecast to slow to 2.4%. The two releases are the last major inflation readings before this FOMC meeting.
Institutional flows have remained relatively firm. U.S. spot Bitcoin exchange-traded funds drew about $1 billion last week, marking a third straight week of net inflows.
Still, on-chain data points to potential selling pressure. CoinDesk reported that more than 71% of the total Bitcoin supply is now in profit. That is above the roughly 67% seen at similar price levels in May. The report said profit-taking could increase as Bitcoin approaches the upper end of its recent $77,200 to $82,100 range.
