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After eight consecutive red daily candles, the price of Bitcoin ended yesterday (Sunday) with a green daily candle. The Bitcoin and crypto market is entering a week that, while not a macro-blockbuster week, could still be defining for the crypto market. In particular, Friday could once again be the most important day of the week.
Last week, the US dollar index (DXY) rebounded from a historically important support level, which put significant pressure on the Bitcoin and crypto markets. Weaker-than-expected consumer expectations, declining US consumer confidence and resilient core inflation supported the DXY index, which will remain in the spotlight this week.
Key dates for Bitcoin and cryptocurrencies this week
On Tuesday, the 16th at 8:30 am EST, the US Census Bureau will release final US retail sales data for April. The final figure for March was -0.6%, well below the forecast of -0.4%. Consumer sentiment is forecast to recover 0.7% in April.
High consumer spending is believed to support the DXY and could accelerate the rally. On the other hand, if the readings do not match the forecast, this will mean that consumers are still reluctant to spend money. Accordingly, DXY is expected to consolidate again, creating a tailwind for Bitcoin and crypto prices.
On Wednesday, the 17th at 8:30 am EST, the Census Bureau will release preliminary US building permit data for April. Recently, the US stock market, and subsequently the price of bitcoin, reacted positively to housing data that turned out to be better than expected.
The number of new housing permits issued in April was 1.430 million, slightly higher than expected. If the forecast of 1.430 million permits issued is again exceeded, this could be another catalyst for the market.
A day later, on Thursday the 18th (8:30 am EST), the Philadelphia Fed will release its latest manufacturing index. The Philadelphia Federal Reserve Bank Manufacturing Index is considered a leading indicator of the all-important ISM Purchasing Managers’ Index and therefore may be important to the financial market as a whole.
If the index falls below the -19.0 forecast for the fourth month in a row, the bearish reaction in the financial market is likely to repeat as it did last month. On the other hand, a reading above the forecast would be optimistic as it would reduce the chance of a recession in the near future.
Friday the 19th is the most important day of the week, as Federal Reserve Chairman Jerome Powell will address the cameras at 5:00 pm EST and may provide new information on the Fed’s interest rate and monetary policy in the coming months. Market volatility is likely to increase. It is noteworthy that 14 members of the Fed are scheduled to speak this week, each with their own point of view.
You can’t make this up, here the Fed members speaking this week:
1. Bostic- Monday
2. Kashkari – Monday
3. Barkin- Monday
4. Cook-Monday
5. Mester-Tuesday
6. Bostic-Tuesday
7. Barr-Tuesday
8. Logan-Tuesday
9. Jefferson-Thursday
10. Barr-Thursday
11. Logan-…— The Kobeissi Letter (@KobeissiLetter) May 14, 2023
DXY down, BTC up?
As far as DXY is concerned, a decision may soon be imminent. As technical analyst Gert van Lagen explains, DXY can expect a sharp reversal similar to the one seen in 2020/2021, but this time it is signaling a downtrend rather than an uptrend.
#DXY – Head and Shoulders reversals:
’20-’21:
1. H&S bottom under red downtrend
2. Right shoulder through downtrend, above SMA 200
3. Pullback (yellow circle)’22-’23:
1. H&S top above green uptrend
2. Right shoulder through uptrend, below SMA 200
3. Pullback (yellow circle) pic.twitter.com/KDkStTMLh3— Gert van Lagen (@GertvanLagen) May 12, 2023
As NewsBTC Chief Analyst Tony Spilotro recently tweeted, the DXY reversal at the end of 2020 marked the start of Bitcoin’s bull run. Whether history repeats itself, time will tell.
This looks like a repeat of 2020 minus a pandemic
DXY vs. #Bitcoin comparison pic.twitter.com/imSzY8aVrW
— Tony “The Bull” (@tonythebullBTC) May 8, 2023
At press time, the price of bitcoin has risen to $27,500 while DXY has shown a slight pullback from $102.752 to $102.559.
Bitcoin price, 1-day chart | Source: BTCUSD on TradingView.com.
