Bitcoin price is up on Feb. 16 as a combination of factors sends BTC to six-month highs.
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Data from Cointelegraph Markets Pro and TradingView shows BTC/USD hit $24,895 on the day — its best since mid-August 2022.
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Bitcoin bulls are feeling the gains this week as the largest cryptocurrency puts in an impressive return to form after weeks of consolidation.
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Macroeconomic tailwinds, principally from the United States, have come hand in hand with improving sentiment across risk assets, giving optimists the edge.
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BTC/USD gained almost 10% on Feb. 15 and another 2% on Feb. 16, with altcoins following suit.
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BTC/USD daily returns chart (screenshot). Source: Coinglass
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The gains come in a key week of U.S. macroeconomic data prints, these so far feeding the narrative that inflation is ebbing — an important prerequisite for risk asset performance.
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Ahead of the Wall Street open, Cointelegraph takes a look at what is moving crypto markets today.
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U.S. macro data emboldens Bitcoin bulls
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It began with a Consumer Price Index (CPI) that mostly conformed to expectations despite a reshuffle in its calculation.
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CPI is a classic volatility catalyst for stocks and crypto, and despite a slow initial reaction, the reaction this time ultimately proved no different.
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Retail sales and manufacturing numbers then further boosted the outlook, with investors providing more “dry powder” for risk trades and sending crypto higher.
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With even more data still to come, the mood is thus all about whether the good news will continue — and whether it can sustain the latest innings of Bitcoin’s blistering 2023 comeback.
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“After a stampede for 10%, BTC bulls ran into a wall,” Keith Alan, co-founder of monitoring resource Material Indicators, summarized.
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“Clean rejection on the first test of key Weekly MAs. A hot Jobless Report could strengthen another attempt. Looking for a partial retrace to deliver another setup to scalp the volatility around the U.S. economic reports.”
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Alan referred to the 50-week and 200-week moving averages (MAs), the latter providing clean resistance since the middle of last year.
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Should U.S. unemployment data come in above expectations, it could send a signal to the market that the Fed’s restrictive economic policy is working and that a turnaround could come sooner rather than later.
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The Fed lowering interest rates and boosting liquidity would make risk asset trades more appealing.
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BTC/USD 1-week candle chart (Bitstamp) with 50, 200MA. Source: TradingView
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BTC price vies with U.S. dollar strength
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In a curious, if temporary, state of affairs, Bitcoin is climbing in tandem with the U.S. dollar.
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Traditionally negatively correlated, the two assets are both benefiting from the current climate — but for different reasons.
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As explained by Dr. Jeff Ross, founder and CEO of Vailshire Capital Management, short-term treasury yields have moved higher, resulting in capital flowing into the U.S.
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“BTC going higher because of increasing worldwide liquidity,” he added, referencing the aforementioned liquidity changes.
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U.S. dollar index (DXY) 1-day candle chart. Source: TradingView
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Others are nervous, however, querying how long the out-of-character status quo might continue.
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"Markets are starting to bifurcate, with Tradfi & $DXY not supporting the move yesterday," trader Mark Cullen warned in part of a tweet on Feb. 16.
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"I think the highs are going to get swept, but the Q is, if this move wipes out both sides 1st?"
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BTC/USD annotated chart. Source: Mark Cullen/ Twitter
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Bitcoin whales guide support and resistance higher
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As Bitcoin began to rise sharply once more, opportunities to influence the rally were not lost on some of its biggest traders.
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Whales are constantly in touch with order book activity, and current conditions have seen bid and ask liquidity move up and down the order book — taking spot price with it.
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“Expecting rejection at $25k and a dump to clear the way for volatility around the 8:30am ET Jobless Report, but they just laddered asks up to $28k,” a tweet explained on the day.
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“If they clear $25k they can exploit the upside illiquidity fast. If you can identify the game, you can mitigate risk.”
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An accompanying screenshot of the Binance BTC/USD order book showed $25,000 strengthening overnight, with crucial support also inching higher to $21,600.
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BTC/USD order book chart (Binance). Source: Material Indicators/ Twitter
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“Corrections are relatively short-lived in an upwards trending market,” Cointelegraph contributor Michaël van de Poppe meanwhile argued.
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“Higher timeframe levels get one test and then markets start to shoot upwards, as people over short the correction. Breaking $25K and we'll continue towards $30-35K for Bitcoin.”
