Bitcoin price slipped to $90,000 on Jan. 13 as the recent weakness in the cryptocurrency market continued.
Bitcoin (BTC) crashed by 16% from its highest level in December and is hovering near its lowest point since November 19. Other altcoins like Solana (SOL) and Cardano (ADA) also continued falling.
The ongoing crypto crash is largely attributed to rising expectations that the Federal Reserve will adopt a more hawkish stance this year. These expectations grew after the U.S. published strong nonfarm payroll data on Friday.
The data showed that the unemployment rate dropped to 4.1% in December as the economy added over 256,000 jobs. These figures led to lower stock prices and higher government bond yields.
The first potential catalyst for a Bitcoin rebound is the upcoming U.S. consumer inflation data, scheduled for release on Wednesday. Economists expect the data to show that inflation rose from 2.7% in November to 2.9% in December. Core inflation, which excludes volatile food and energy prices, is expected to remain at 3.3%.
Bitcoin and other altcoins may rebound if inflation numbers come in lower than expected. For instance, if the headline and core Consumer Price Index drop to 2.5% and 3.0%, respectively, it could spark a recovery in crypto prices.
Another key factor to watch is the upcoming inauguration of Donald Trump, which could impact the crypto market. Trump campaigned on making the U.S. the global crypto capital and has already made some moves toward that goal. He appointed Paul Atkins as the next Securities and Exchange Commission chief and started forming a crypto panel of experts.
Therefore, his upcoming inauguration and Gary Gensler’s resignation may lead to hype in the crypto industry. All this is happening as companies like MicroStrategy and Semler Scientific continue buying Bitcoin.
Bitcoin price technicals
Another potential catalyst for Bitcoin’s price is its technical setup. BTC is holding at a key support level of $90,100, a point it has not breached since December. This suggests that bears are hesitant to place short positions below this level.
Additionally, the accumulation and distribution indicator has been rising, signaling ongoing accumulation.
While the $90,100 support level forms the neckline of a bearish head-and-shoulders pattern, Bitcoin is likely to bounce back this week. Historical data also shows that Bitcoin tends to rebound after falling on a Monday.
