Bitcoin Suffers False Breakout Near $32K; Sheds Over 6%
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At press time, the cryptocurrency has returned above the $29.5K support, maintaining its one-month range. Some factors appear to encourage some price gains for BTC in the near term.
However, technical analysts propose a slump below $24K in the coming weeks is imminent. This sentiment is supported by broad expectations of increased selling pressure ahead of the US inflation data release later this week.
Another factor supporting further declines in Bitcoin and the crypto market is increased regulatory scrutiny on the cryptocurrency industry.
As mentioned earlier, the US inflation report for May, scheduled for Friday, will have significant sway on the crypto market and define the broader sentiment for June. Following a slowdown in inflation in April, analysts expect to see further reductions in consumer prices through May.
According to financial market data provider MarketWatch, the consensus is to see an 8.2% YoY inflation report in May. However, a report lower than this consensus reading will likely trigger a bullish rally for BTC. At the same time, a higher-than-expected report would spark an even steeper decline for BTC.
Meanwhile, the highly-anticipated crypto bill, which should be released this week, also holds sway over the near-term price action of the crypto market.
Key Bitcoin Levels to Watch — June 7
As mentioned earlier, Bitcoin suffered another sharp rejection near the $32K in an all too familiar false breakout. However, the price rejection got repelled by the $29.5K support level, which prevented a sustained correction and stabilized the price after the dip.
That said, BTC is not out of the woods yet as analysts expect a dramatic slump in the coming days, ahead of several market-moving data and announcements. The benchmark cryptocurrency could revisit May 12 low near $24K if it fails to hold the $28.7K pivot base.
Meanwhile, my resistance levels are at $30,000, $30,300, and $31,000, and my key support levels are at $29,500, $29,000, and $28,000.
Total Market Capitalization: $1.23 trillion
Bitcoin Market Capitalization: $569.9 billion
Bitcoin Dominance: 46.4%
Market Rank: #1
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