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- All eyes are currently on the macro indicators as investors await the US CPI data to gauge the Fed action ahead.
- The accumulation by Bitcoin retail investors holding less than 1 BTC has outpaced the total BTC produced each month.
Since the last weekend, Bitcoin (BTC) has come under strong selling pressure as the Bitcoin network gas fee shot up significantly higher due to strong network activity contributed by Bitcoin Ordinals aka Bitcoin NFTs. As of press time, Bitcoin (BTC) is trading at $27,558 with a market cap of $533 billion, showing a near 4 percent dip on the weekly chart.
The total number of unconfirmed transactions on the Bitcoin blockchain had skyrocketed to nearly half a million with Binance having to pause withdrawals twice last Sunday. However, the next big question in everyone’s mind is where is Bitcoin heading from its current levels.
Macro Trends to Drive Bitcoin Price Forward
Investors are waiting for how the macro trends are evolving from the current stage. The United States will announce the CPI data later today which will give a clear picture of the state of inflation. On Tuesday, May 9, On Tuesday, FOMC Vice Chair John Williams shared his views on the economic outlook as well as the monetary policies in the country.
“First of all, we haven’t said we’re done raising rates. We’re going to make sure we’re going to achieve our goals, and we’re going to assess what’s happening in our economy and make the decision based on that data,” he said. Besides, Williams also added that there is no decision of interest rate cut in his baseline forecast and that he could hike the rates if required.
Callie Cox, an analyst at eToro Investment, said that inflation remains as one of the major concerns for everyone, from the Fed to the crypto traders. In an interview with CoinDeskTV, Cox said:
Powell really leaned into his megaphone and provided some very flexible language on the future of policy. They keep dropping hints and statements, where they basically change the language around if future policy moves are needed. This could be a hint that the Fed is becoming more flexible.
However, she adds that despite the recent issues with congestion, Bitcoin remains a defensive asset that has recently outperformed the S&P500 on most of the CPI and Fed days. “In the wake of massive sell-offs, Bitcoin, while still risky, seems to be benefiting from both its traditional role and its emerging role as a value store during lower rates,” she said.
Bitcoin Technical and On-Chain Data
As it turns out, Bitcoin shrimps have continued to accumulate at every point. The accumulation by Bitcoin retail investors holding less than 1 BTC has outpaced the total BTC produced each month.
The purchases from Bitcoin shrimp (holders w/ less than 1 BTC) is currently out stripping the amount of BTC produced each month.
Just small retail is eating all the new supply! Insane!
And yes, whales, companies, funds, etc. all still want a piece of the tasty Satoshi pie too! pic.twitter.com/6PSmxB6eh6
— Lark Davis (@TheCryptoLark) May 10, 2023
On the downside, if BTC fails to hold $27,000, the next support level is at $24,000.
If $27,000 fails to hold for #Bitcoin
$24,000 is next. pic.twitter.com/YulNcHcdIi
— Crypto Rover (@rovercrc) May 9, 2023
