Bitcoin’s price continues to trade near the $87,000 level with investors waiting for a major catalyst.
Bitcoin has been sensitive to the news lately, from Federal Reserve policies to employment data.
Five major events, including the PMI, CCI, jobless claims data, and more, could influence Bitcoin's price action this week.
Lower consumer confidence, rising jobless claims or slowing GDP could make Bitcoin more attractive to investors as a hedge.
Investors should watch out for things like stronger economic data (PMI, GDP, and low jobless claims).
Bitcoin’s price continues to trade near the $87,000 level, as the bulls continue to tug against the bears.
The crypto heatmap | Source: CoinMarketCap
The cryptocurrency has been strongly influenced by macroeconomic events lately—especially with the major crash that resulted from the tariff announcements from US President Donald Trump in February.
While crypto traders are eyeing the news for possible indicators of a breakout, here are some of the biggest economic events for this week, that could influence market sentiment.
Bitcoin has been sensitive to the news lately, from Federal Reserve policies to employment data.
Interestingly, the cryptocurrency has always been seen as independent from the traditional market.
As it stands, investors are now reacting more than ever to key economic data, the same way they do in traditional finance.
Risk-on sentiment drives Bitcoin higher, while uncertainty or risks of tighter monetary policy push investors towards safer assets.
This week, five major US economic events could affect Bitcoin’s price action.
Let’s see why each of these events is important and how they can influence Bitcoin’s next moves.
The Purchasing Managers’ Index (PMI) is the first on the line of major events to track this week.
This data tracks business activity in the manufacturing and services industry.
As it stands, a reading above 50 is believed to point towards expansion, while a reading below 50 points towards contraction.
The report is expected to be released on 24 March, and if PMI remains strong, the resulting confidence in economic growth could fuel investor risk appetite.
On the other hand, if PMI weakens, concerns over an economic slowdown could result and drive investors toward alternative assets.
The Consumer Confidence Index is the next in line when it comes to major US economic events.
This report measures the sentiment among US consumers, especially regarding their spending behavior and risk appetite.
If the confidence rebounds, the resulting positive sentiment could drive stronger retail and investment demand for Bitcoin.
On the flip side, a decline in investor confidence might lead to risk aversion and affect Bitcoin's upside negatively.
Interestingly, the reading from February showed a sharp decline, which raises concerns about economic uncertainty.
If the confidence remains low with the new report, the expectations for Federal Reserve rate cuts could increase.
As a result, Bitcoin will become more and more attractive as a hedge against declining fiat value.
As with jobless claims, this report provides insights into the strength of the labor market—which influences Fed policy decisions.
As forecasted, these claims could rise above 226,000. However, a weakening labor market could raise fears of an economic slowdown.
This could boost Bitcoin’s position as an alternative investment and drive prices up.
On the other hand, if the claims remain low, it would signal a resilient job market.
As such, liquidity will exit the Bitcoin market and cause a price decline.
With US President Donald Trump prioritizing job growth, unexpected shifts in employment data could influence investor sentiment in both the traditional and crypto markets.
The second estimate of Q4 GDP growth is expected to shed more light on the state of the current US economy.
The initial estimate showed a 3% growth, but expectations have now been revised down to 2.3%.
If GDP beats expectations, it would signal a strong economy, which could shift investment toward traditional assets and put a pin in Bitcoin’s rally.
On the other hand, if GDP disappoints, the concerns over an economic slowdown could increase the speculation about more Fed rate cuts.
As such, Bitcoin could rally to the upside.
One controversial aspect of this is Trump’s recent Executive Order which proposed a Strategic Bitcoin Reserve using seized assets.
While many believe that this could strengthen the economy, critics continue to argue that it won't directly boost the country's GDP.
The Personal Consumption Expenditures (PCE) is the Fed’s preferred inflation gauge and is expected to reveal February’s inflation trend.
The previous reading showed a 2.5% year-over-year increase.
If inflation turns out higher than expected, the FED might delay its rate cuts. As a result, liquidity will become more restricted and will pressure Bitcoin all the more.
On the flip side, if inflation cools, the case for more rate cuts will become stronger and might fuel a Bitcoin rally.
Bitcoin’s reputation as a hedge against inflation makes this report one of the most crucial events for the week, and investors will be on the lookout for what it turns up.
Considering these major economic releases, Bitcoin traders should prepare for possible volatility this week.
Investors should watch out for things like stronger economic data (PMI, GDP, and low jobless claims). This could limit Bitcoin's upside as investors lean more toward traditional assets.
Weaker data like lower consumer confidence, rising jobless claims, or slowing GDP could make Bitcoin more attractive to investors as a hedge.
Higher inflation data, like a PCE index above expectations, could weigh on Bitcoin’s price action over the short term due to delayed rate cuts.
On the other hand, lower inflation could be bullish and could increase the odds of monetary easing.
At the time of writing, Bitcoin is now consolidating near the $87,000 zone the market is waiting for a catalyst that could fuel a run toward $90,000.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.