Bitcoin is entering a week packed with macro triggers, with markets focused on the Federal Reserve’s latest rate decision, upcoming U.S. inflation data and the direction of the U.S.-Iran situation, according to BlockBeats on July 27.
The Fed is set to announce its latest rate decision on July 29. With inflation pressure and geopolitical risk still in view, markets have started pricing in the possibility of another hike. CME FedWatch data shows traders currently assign roughly a 31% probability to a rate increase this week, while the odds of a hike at the September meeting had at one point risen to 50%. The yield on the U.S. 2-year Treasury climbed to 4.3% last week, adding to expectations that policy could stay tight.
That pressure eased somewhat after the United States and Iran paused military action, with oil prices falling about 8% in Monday early trading.
PCE report due July 31 draws fresh attention
Beyond the Fed meeting, markets are also watching the U.S. personal consumption expenditures inflation report for June, scheduled for release on July 31. May PCE had risen 4.1% year over year, the highest level in three years. The market now expects the June reading to cool to around 3.7%.
Bitcoin’s correlation with U.S. stocks keeps weakening
TradingView data shows the 20-week rolling correlation between BTC/USD and the S&P 500 is now near its lowest level since March. Its correlation coefficient with the Nasdaq stands at just 0.11. Even so, risk assets could still move in tandem again if macro conditions deteriorate.
On-chain data shows cooler whale inflows to exchanges
On-chain signals also point to softer large-holder flows into trading platforms. CryptoQuant data shows that since June 12, the amount of BTC sent by whales to Binance has dropped about 44%, while retail inflows have declined about 22%. Retail inflows are now roughly twice the size of whale inflows, leaving a gap of $3.9 billion.
BTC tests a key technical range
On the price side, Bitcoin touched $65,680 after the weekend close and then continued testing resistance at the 50-month exponential moving average. Analyst Rekt Capital said BTC is currently trapped between the 200-week moving average and the 50-month moving average, with continued compression potentially setting up a large move.