Bullish view
- Buy the BTC/USD pair and set a take-profit at 75,000.
- Add a stop-loss at 65,000.
- Timeline: 1-2 days.
Bearish view
- Sell the BTC/USD pair and set a take-profit 65,000.
- Add a stop-loss at 75,000.
Bitcoin price held steady above the key psychological level at $70,000 as volatility in the market dropped and a risk-on sentiment prevailed. The BTC/USD pair was trading at 70,800, up sharply from the year-to-date low of 60,100.
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Bitcoin jumped as investors moved back to risky assets as the US dollar retreated. The US Dollar Index (DXY) tumbled to $96.80 from this month's high of $98.
The Dow Jones Index rose by 55 points, while the S&P 500 Index and Nasdaq 100 rose by 45 and 267 points, respectively.
These assets jumped as a continuation of a market rally that added over $1 trillion in assets on Friday. It also jumped as investors anticipate some major macro data, including the labor market and US consumer inflation.
The non-farm payrolls (NFP) report expected on Wednesday will show that the economy added 70k jobs in January, higher than the previous month's 50k. Also, the unemployment rate is expected to remain at 4.4%.
The US will also publish the latest US inflation data on Friday, with the headline Consumer Price Index (CPI) expected to come in at 2.5% from the previous 2.6%.
Bitcoin also rose after Japan elected Sanae Takaichi and her party. Takaichi is known for embracing more expansionary policies, including stimulus, which may boost risky assets.
Still, the ongoing Bitcoin recovery may not last for long as the Crypto Fear and Greed Index remained at the extreme fear zone of 9. Also, Bitcoin’s volume and futures open interest remained low.
BTC/USD Technical Analysis
The daily timeframe chart shows that the BTC/USD pair rebounded from a low of 60,200 on Friday last week to the current 70,900.
It has formed a small bullish flag pattern, a common bullish continuation sign in technical analysis. The Relative Strength Index (RSI) has moved from a low of 17 to the current 35 and is pointing upwards.
Similarly, the two lines of the Stochastic Oscillator have continued rising and are nearing the neutral point of 50.
Therefore, the pair will likely continue rising as bulls target the key resistance level at 75,000. However, a drop below the year-to-date low of 60,200 will invalidate the bullish outlook.
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