Last week, Bitcoin traded in the range from $56 thousand to $61.8 thousand. Trading was relatively calm, as investors were still recovering from the market crash on August 5. Since the beginning of the week, Bitcoin has risen in price by 0.75% to $59.1 thousand, and Ethereum by 1.70% to $2.6 thousand. On August 12, the BTC/USDT pair increased by 1.08% to $59.3. The day was volatile, but within a limited range of $57.6 thousand – $60.7 thousand. Fluctuations were caused by the dynamics of American stock indices. Investors were expecting the publication of important inflation statistics on August 13 and 14. On August 13, BTC/USDT grew by 2.09% to $60.5 thousand. Growth was observed in the American session after the publication of data on manufacturing inflation and the weakening of the dollar. The US Producer Price Index (PPI) showed lower growth than expected, causing the dollar to weaken and cryptocurrencies to rise. On August 14, there was a decrease of 3.14% to $58.6 thousand. After updating the maximum at $61.8 thousand, a downward movement began. The reasons for the fall were the rebound from the $61.5 thousand resistance and the news about the movement of about 10 thousand BTC by the US government, which raised fears of a possible sale and price collapse.
On August 15, the BTC/USDT pair fell another 1.95% to $57.5 thousand, despite the growth of US stock indices. Strong US retail sales data helped dispel recession fears, but did not provide support for Bitcoin. On August 16, BTC/USDT increased by 2.32% to $58.8 thousand. The range of the daily candle was 4.76%. An increase in quotations was observed in the American session after the release of a report on consumer sentiment from the University of Michigan. The consumer sentiment index remained virtually unchanged for the fourth month in a row, rising slightly by 1.4 points. This indicates relative stability in consumers’ perception of the economy. Inflation expectations for the year ahead remained at 2.9% for the second month in a row. Long-term inflation expectations have remained at 3.0% for five months. These figures remain slightly elevated compared to the pre-pandemic period.
On August 17, the BTC/USDT pair was trading at $59.1 thousand. The price had been flat for 9 days after a sharp rebound on August 8 to $62.7 thousand. According to BitRiver estimates, the growth of US stock indices is a harbinger of a continued increase in BTC quotes in the direction of $68. 7 thousand (the nearest resistance level is in the local downward sideways trend from the top of $73.7 thousand on March 14, 2024). On Sunday, August 18, Bitcoin (BTC) is trading around $60 thousand, its price has risen by about 2% over the week. Our leading analyst Konstantinas Sizovas studied the situation on the cryptocurrency market and told how it could change in the coming week.
The market is currently in equilibrium. Buyers are not active, fearing an imbalance between supply and demand due to the movement of bitcoins by the US government. It is possible that large miners may collapse the market in order to increase their share in the industry, thereby displacing weak miners working on old equipment. The idea is risky, but a potentially profitable strategy for the long term. While the price is low, equipment is being actively updated. Those who do not have time to update may be forced to leave the market, since after halving the profits will not compensate for the costs of mining.
Importantly, funding rates in perpetual Bitcoin futures on Binance were negative for the third day in a row, reaching levels not seen since October 2023. This suggests that traders are actively opening short positions, planning to make money on a falling market. However, often such traders are punished and the price goes in the opposite direction, so this is more of a bullish signal. However, if you don’t expect a recession in the US, prepare for increased market volatility as we get more weak economic data.
Buyers have no new energy, and sellers lack the confidence to take the price below $51 thousand. In the coming week, investors’ attention will be focused on Fed Chairman Jerome Powell’s speech at a symposium in Jackson Hole, which will take place on August 22-24. Powell is expected to signal a rate cut path as inflation remains on track to return to its desired 2% level and the labor market is no longer overheated. The start of the rate cut cycle will begin to play into the hands of buyers. Bitcoin will probably trade in the range of $56 thousand – $61 thousand all week.
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