Bitcoin pulls back from $70,000 area before FOMC

Start of the session on Wall Street turned out to be very successful. Lower CPI data from the US drove stock markets and cryptocurrencies higher, due to increased likelihood of a more dovish stance from the FOMC in the medium term. This particularly concerns the revision of the implied interest rate path for September. After the CPI data, the chance that the FED will decide on the first 25 basis points cut in this cycle rose to 65.5% (it was only 49% yesterday).

Bitcoin itself gains nearly 4% today, but uncertainty ahead of the FOMC is currently driving the cryptocurrency slightly lower. In the short term, another catalyst for downward pressure could be yesterday’s data on inflows to spot ETF funds, which indicated the largest since May 1st this year.

We recorded another strong net outflow from spot ETF funds yesterday. Source: XTB

Bitcoin remains in a key consolidation structure. Investors will closely watch whether BTC, in case of a positive reaction to the FOMC decision, can break above the 70,000 USD barrier (currently, this zone is the most important area of technical resistance). In the case of a more sustained reversal, it seems that an important support area could be around 67,150 USD (the 50-day exponential moving average). Source: xStation5