Macro to dictate Bitcoin’s next $10,000 move as traders watch for price breakout

Traders are waiting on macroeconomic factors to signal Bitcoin’s next price move as the crypto market consolidates following its biggest fall in almost four years.

Over the past month, Bitcoin slid some 28%, revisiting the levels it traded at before President Donald Trump’s 2024 election win. Since then, the top cryptocurrency has ping-ponged between $74,400 to $65,000 as investors wait for the dust to settle.

Ben Harvey, a researcher at crypto investment firm Keyrock, told DL News he expects the next big Bitcoin move to be driven by factors outside of the crypto market.

“Firstly macro data that shifts the rates path,” Harvey said. “Secondly, there’s changes in Treasury financing expectations, and the final catalyst would be an inflection in institutional demand, visible through spot ETF flows.”

Financial markets traders typically look to interest rate forecasts when managing their risk.

Rate cuts, which often come in response to poor economic data, are usually viewed as bullish for risk assets like cryptocurrencies as they make borrowing less expensive and inject more liquidity into the financial system.

Yet, it’s unlikely that the Federal Reserve will cut rates before its June meeting, according to the CME FedWatch tool.

No narrative

The reason macroeconomic data is seen to be so important is because the crypto market currently lacks a narrative.

Last year, Trump’s crypto-friendly policies coupled with the passing of key stablecoin legislation helped buoy Bitcoin to an all-time high of over $126,000 in October.

But with further efforts to legislate digital assets stalling, and commodities like gold and silver dominating the so-called debasement trade, investors have been left questioning Bitcoin’s role in the broader economic landscape.

The result? Droves of traders have abandoned the crypto market, resulting in low liquidity and muted price movements.

“The market is catching its breath after some significant downside liquidity and targets were tagged last month,” Nathan Batchelor, managing partner at crypto trading data platform Biyond, told DL News.

According to Batchelor, tax season and a cyclical moving of funds back into the traditional financial system, have weighed on Bitcoin in recent weeks.

“A sustained range breakout from the $74,400 to $65,000 range could set about the next $10,000 directional move,” Batchelor said.

Room for optimism?

Some are optimistic that Bitcoin can break out of that range to the upside.

“Inflation remains moderate, GDP growth looks healthy and I see Fed rate cuts being moved up to June, which should support risk sentiment,” David Duong, global head of investment research at Coinbase, told DL News.

Duong said his market analysis shows $82,000 as a key level of resistance for Bitcoin which it will need to reclaim in order to move higher.

The low liquidity in the crypto market works both ways. If capital flows back in, Bitcoin’s price plunge could turn around quickly.

“We saw positive netflows this week, so that’s an immediate catalyst to watch,” Keyrock’s Harvey said. “Separately, a large options expiry or a sharp rebuild in futures leverage can quickly turn a range into a trend.”

Finally, there’s the Clarity Act, a broad crypto market structure bill that has stalled while passing through the US Senate.

If lawmakers move the bill forward, it could help shore up the battered crypto market, US Treasury Secretary Scott Bessent said in a Thursday interview on CNBC.

Still, a crypto market recovery this soon after such a large price plummet would be unusual by historical standards.

“Given the substantial technical damage done last month, remaining sceptical about upside moves is favourable,” Batchelor said.

Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at [email protected].