Bitcoin has found strong support at $18,921 after facing a severe crash in June 2022. The digital asset had fallen to its lowest level in two years on the 13th of June 2022 when the price hit $17,588. However, the bulls have gradually taken over after retesting this lowest support level. Hence, we saw the price rise to $21,873 over the weekend. This equally allowed cryptocurrency prices to gradually bounce back.
What is the next target for Bitcoin?
Bitcoin is recovering from the profound loss created in 2022 because of the aggressive interest rate hike by the Fed. The price is expected to break the resistance at $22,500 this week, which will pave the way for higher levels. Failure to achieve this target will lead to a retest of the previous support. We have therefore highlighted below the critical support levels to watch out for Bitcoin this week.
Bitcoin key support levels this week
The first support level for Bitcoin at the moment is located at $20,500, a break below this support will give room for a free fall down to 20K, which is the second strong support for Bitcoin. Further downside below this level would trigger a retest of the strong support established at $18,921.
Bitcoin price-movers this week
As we already know, Bitcoin prices are pegged to the US dollar. This means that an increase in the dollar strength will discount BTC prices. Therefore, we have highlighted some critical economic data affecting US dollar performance this week. They include below:
- Conference Board Consumer Confidence: This data will be released tomorrow during the New York session. The CB Consumer Confidence provides a composite index of the average household spending. More household spendings indicates confidence in the economy, which will strengthen the US dollar and discredit Bitcoin. On the other hand, lower spending would indicate a lack of confidence in the economy, which will further enhance Bitcoin and weaken the dollar index. The forecast for this data is 100.0, while the previous figure was 106.4.
- Fed Chair Powell Speech on Wednesday: The Fed Chairman - Jerome Powell, will be delivering an important speech on Wednesday in a panel discussion titled 'Policy Panel.' This will take place in Portugal. His tone of voice during this session will indicate whether there will be a further interest rate hike in July.
- Core PCE Price Index m/m: The Core Personal Consumption Expenditures (PCE) Price Index measures the change in consumer goods and services prices, excluding food and energy. The Fed favours this inflation measure because a higher inflation rate will make further interest rate hikes in July inevitable. This will affect Bitcoin and other cryptocurrencies negatively. There might be a retest of the previous lows if the interest rates were to be hiked again in July.
- ISM Manufacturing PMI: This data measures the pace of business growth by measuring the diffused index of the purchasing managers in the manufacturing industry. A higher reading from this data above 50.0 is positive for the US dollar. At the same time, a lower score below 50.0 will reduce the dollar strength. This will strengthen Bitcoin's recovery in reverse.