Bitcoin (BTC) started the new week barely above $30,000 as a “bearish divergence” set the tone.

After a quiet weekend, bitcoin price action faces a potential pullback period in its broader bullish trend, traders said.

What might be on the menu at the market this week?

After a period of relative calm, with the release of US macroeconomic data and several speeches from Fed officials, the external triggers for risk assets are back.

Beyond that, there are some interesting dynamics at play in U.S. bitcoin buying, the element of volatility is there.

Cointelegraph focuses on these factors and more in its weekly recap that could influence the market in the coming days.

Limp $30,000 Support Has Traders Eager for Bitcoin Price Drop

Bitcoin could end the week just above $30,000, data from Cointelegraph Markets Pro and Cointelegraph Markets Pro confirms transaction viewbut its strength does not seem convincing now.

An immediate drop into the $20,000 region followed, setting the tone for traders who believe a pullback period could be in store before resuming the upside.

BTC/USD 1-hour chart. Source: TradingView

Trader Skew said: “Will look for trend continuation for another higher low between current price and $28,000” explained in his short-term forecast.

“Otherwise apparent weakness would lead to a breakout of the 1W structure (equal to highs and LL below $25,000).”

BTC/USD annotated chart. Source: Skew/Twitter

Fellow trader Yeller noticed warning signs on the weekly time frame.

“Bitcoin Stuck in Weekly Bearish Divergence Overnight,” he Tell Twitter followers follow the relative strength index (RSI) behavior after the candle closes.

“Time to defend for a while. A bull market is coming, but pullbacks are part of the game. Lower bids, let’s see.”

BTC/USD annotated chart with RSI. Source: Jelle/Twitter

For the Crypto Tony, downside could be limited to $29,500, which complements a new yearly high set in the previous week.

“To me, the $29,500 sweep makes sense because the bulls seem to be getting weaker now. We’ve cleared the liquidity above, so it’s time to grab the liquidity below. If you haven’t already , must wait for this test and recover.” Summarize.

Further posts narrowed down to predict The price of BTC/USD will increase by 40% in 2023, but then there will be a “larger correction”.

BTC/USD annotated chart.Source: Crypto Tony/Twitter

8 Fed speakers to accompany key macro data week

Macro commentators will have a difficult job this week as the consumer price index (CPI) leads US economic data.

The July 12 release of the Consumer Price Index (CPI) showed a drop in inflation, which will provide some relief from the Fed’s still-hawkish stance.

The market is almost unanimous that rates will be raised again after a pause last month, and the out-of-trend data could spark some last-minute uncertainty.

A day later, the consumer price index (CPI) will be released, followed by the producer price index (PPI), when a total of eight Fed officials will speak on the economy and policy.

“Markets to return to volatility this week,” financial commentary resource Kobeissi Letter, forecast Also summarize the calendar.

The latest data from the CME Group FedWatch tool puts options on rate hikes odds As of this writing, it stands at 92%, down slightly from 95% last week.

Fed target rate probability map.Source: CME Group

Financial commentator Tedtalksmacro continues to believe that the core CPI will be the data to watch from the Fed.

“Headlines are expected to drop to 3.20% YoY, which would be the lowest level since March 2021. Cleveland Fed, University of Michigan + Truflation are all expected to see similar numbers,” he said famous Part of a Twitter thread.

“Core CPI is expected to fall to 5.1% year-on-year, the lowest level since November 2021. The core remains the focus of the market, and I expect the market to place more weight on it in Wednesday’s reaction.”

US core CPI forecast chart. Source: Tedtalksmacro/Twitter

Bitcoin mining difficulty hits all-time highs along with hash rate

In a refreshing turn of events, Bitcoin network fundamentals are poised to hit new all-time highs in the coming days.

The latest estimates come from bitcoin network Network difficulty is expected to jump more than 5%, the largest single increase since late March.

An overview of the basics of the Bitcoin network (screenshots). Source: BTC.com

This is significant given the stagnant price action, reflecting continued competition in the mining sector and increased confidence in future profitability. In doing so, the difficulty would offset the previous decline to a new record high of around $53.2 trillion.

A similar story involves hash rate, some estimatesbreaking the 400 exahashes per second (EH/s) mark for the first time in recent days.

Bitcoin estimated total hash rate chart. Source: Blockchain.com

BTC price is still more than 50% below 2021 peak, further confirming this classic adage“price follows hash rate.”

Commenting on what could happen, Blockware mining analyst Joe Burnett said that Bitcoin will return in 2020 after breaking out of its all-time high three years ago, completing what it started.

“During the bull market in 2017, there were no national mining bans that shut down half of the network’s computing power, nor did FTX, BlockFi, and Celsius sell fake coins,” he said. makes sense.

“Most people are not ready for the next parabolic run.”

BTC supply shock ‘inevitable’

Recent filings for a bitcoin spot price exchange-traded fund (ETF) in the United States have sparked a buying spree.

As Cointelegraph reported over the weekend, activity in the U.S. is on the rise again, competing with Asia for ownership of BTC supply.

The analysis believes that the impact of the supply reduction will become more and more obvious over time, with only 7.5% of Bitcoin’s immutable 21 million coins left to be mined.

“In this Bitcoin cycle, it is different from the previous 3 cycles. Over time, the number of Bitcoins available for transactions gradually decreases.” Commentator Alessandro Ottaviani debate this weekend.

“If this trend continues, a supply shock will be inevitable. It’s just a matter of time, we just don’t know when. As Bitcoin supporters, we can wait, because if we are Bitcoin supporters, our time preference is will be low.”

Octaviani uploaded a chart called the “HODL Model,” a popular tool that maps supply availability versus future price performance.

Bitcoin HODL model chart.Source: Alessandro Octaviani/Twitter

On the topic of ETFs, especially BlackRock, the world’s largest asset manager, Ottaviani added that the mainstream narrative has shifted to pampering Bitcoin rather than bashing it.

Big Fish Increases Exposure

It’s not just miners showing “confidence” when it comes to Bitcoin’s future profitability.

Related: AI Has Potential to Push Bitcoin Above $750,000 – Arthur Hayes

As research firm Santiment pointed out this weekend, even as BTC price conditions stagnate, the largest group of Bitcoin investors are still eager to buy.

So-called sharks and whales (entities with 10 to 10,000 BTC) have increased their exposure by over 70,000 BTC since mid-June.

“Bitcoin’s sharks and whales aren’t showing any signs of slowing down, even as prices start to get ‘boring’ in the $30,000-$31,000 range,” Santiment commented.

“Since June 17, $10 to $10,000 BTC addresses have accumulated 71,000 BTC, equivalent to $2.15 billion.”

Bitcoin Shark and Whale Data Annotated Chart. Source: Santiment/Twitter

Separate data from on-chain analytics companies glass node shows that the number of whales (owning at least 1,000 BTC) is at an eight-month high.

Bitcoin whale entity chart. Source: Glassnode

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