Bitcoin may see a decline in its early-week gains on May 14 due to heightened volatility in macroeconomic data reports. TradingView data indicated a weakening Bitcoin price in hourly intervals, leading to a dip to $61,440 on centralized exchanges. Earlier, the BTC/USD pair had peaked at $63,450, posing a significant risk for short positions in the futures market.
What Are the Bitcoin Trends?
Material Indicators, in a post on X, warned that surpassing the $63,000 mark could squeeze short positions in the futures market. However, Bitcoin bulls failed to sustain momentum. CoinGlass data revealed substantial liquidity migration downward at the time of writing. Bids strengthened at $60,000 and $65,000 levels ahead of key U.S. economic reports.
The day’s economic reports include the Producer Price Index (PPI) and comments from Federal Reserve Chair Jerome Powell. Material Indicators highlighted the common practice of placing and withdrawing order book guardrails ahead of such reports.
How Will US Reports Impact Markets?
Financial commentator Tedtalksmacro pointed out an unusual event where PPI data would precede April’s Consumer Price Index (CPI) figures. This rare alignment could lead markets to react more sharply if expectations are not met, given the strong historical correlation between PPI and CPI data.
CME Group’s FedWatch tool indicated that significant market surprises would be needed to alter expectations of a Federal Reserve rate cut before September. Currently, the probability of a 25 basis point cut at the June Federal Open Market Committee (FOMC) meeting is 3.5%, rising to 24.6% for the July meeting.
Key Takeaways for Investors
- Monitor PPI and CPI data closely for market volatility.
- Be cautious of liquidity movements around key support levels.
- Pay attention to Federal Reserve communications for hints on rate policy changes.
As Bitcoin faces potential setbacks due to increased volatility, investors should remain vigilant and consider these critical factors for informed decision-making.