Bitcoin Fails to Breakout After "Hot" PCE Data Hit U.S. Stocks and Pulls DXY Back from Collapse. Data from Cointelegraph Markets Pro and TradingView follows BTC/USD, which is trading in a tight range around $23,800.
The pair attempted to reclaim $24,500 the previous day but ultimately proved unsuccessful as resistance capped gains. Still, Bitcoin’s reaction to the latest U.S. personal consumption expenditures (PCE) index was muted, with the index coming in at 4.7% instead of the expected 4.3% a sign that inflation isn’t fading as quickly as hoped.
For popular commentator Tedtalksmacro, that would lead the Fed to consider a bigger rate hike at its March meeting a potential headwind for risk assets, including cryptocurrencies.
"That's a 50 basis point guess in March," he argued in a partial Twitter reaction.
Meanwhile, Cointelegraph contributor Michaël van de Poppe focused on BTC/USD itself, remaining optimistic about the short-term outlook. “Markets are still making regular corrections in an uptrend,” he wrote next to a chart highlighting important levels.
Monitoring resource material indicators highlighted that the Binance order book has higher resistance than the spot price, with maximum support at $23,000. Popular trader and analyst Rekt Capital also suggests that BTC/USD is trying to hold onto a trendline that recently flipped to support on an intraday time frame.
“Haven’t had a 3rd consecutive retest, but BTC remains above lower high resistance,” he tweeted. U.S. stocks fell more sharply in the PCE data, with the S&P 500 and Nasdaq Composite down 1.4% and 1.7%, respectively, as of this writing. The U.S. dollar index (DXY) was well received, climbing to 105.3 on the day, its highest level since Jan. 6.
DXY weakness, a key feature of January’s cryptocurrency rally, reversed in February, consistent with increased difficulty for Bitcoin bulls keen to maintain gains above 50%.
"Dollar index #DXY moves further into 200-day moving average cloud," Caleb Franzen, senior market analyst at Cubic Analytics, wrote in part of a Twitter feed.
Franzen added that the U.S. dollar index "could see more upside in this range, but the entire range is potential resistance."
