Bitcoin Sinks Amid Market Sell-off; NVIDIA Earnings and Fed Rate Outlook in Focus

Bitcoin Sinks Below $60,000 in Crypto Market Sell-off

On Tuesday, August 27, BTC tumbled 5.40%, following a 1.85% loss from the previous session, closing at $59,507. BTC extended its losing streak to three sessions as the broader market slid by 5.30% to a total market cap of $2.041 trillion.

Investors Take Profit as US Economic Data Ease Fears of a Hard Landing

BTC has been on a downward spiral since Fed Chair Powell’s speech induced rally to Friday’s high of $65,055.

This week, US economic indicators eased immediate fears of a hard US economic landing, possibly leading to an unwinding of bets on aggressive Fed rate cuts to bolster the US economy.

On Tuesday, the US CB Consumer Confidence Index rose unexpectedly from 101.9 in July to 103.3 in August, accelerating the decline.

US BTC-Spot ETF Market Flows Fuel Caution

On Monday, August 26, iShares Bitcoin Trust (IBIT) saw net inflows of $224.1 million, extending the US BTC-spot ETF market’s net inflow streak to eight sessions. The US BTC-spot ETF market reported total net inflows of $202.6 million. Significantly, BTC rose to an early Tuesday high of $63,236 before the sell-off.

The extension of the US BTC-spot ETF market inflow streak  to nine sessions may hinge on another surge in IBIT inflows. Meanwhile, other issuers registered net outflows.

According to Farside Investors:

• ARK 21Shares Bitcoin ETF (ARKB) had net outflows of $102.0 million.
• Grayscale Bitcoin Trust (GBTC) saw net outflows of $18.3 million.
• Bitwise Bitcoin ETF (BITB) reported net outflows of $6.8 million.

Excluding inflow and outflow data for iShares Bitcoin Trust (IBIT), Invesco Galaxy Bitcoin ETF (BTCO), and Valkyrie Bitcoin Fund (BRRR), the US BTC-spot ETF market recorded net outflows of $127.1 million.

The recent BTC reversal may stem from investor caution ahead of NVIDIA’s (NVDA) earnings report and Friday’s US Personal Income and Outlays Report.

Key Reports to Influence BTC Price Trends

On Wednesday, August 28, NVIDIA could significantly impact BTC. Strong results could push BTC toward $65,000. However, weak numbers could send BTC lower ahead of the US Personal Income and Outlays Report.

Softer US inflation and personal spending figures may also boost BTC demand on expectations of multiple 2024 Fed rate cuts. However, sticky inflation and rising personal spending could dampen hopes of a September Fed rate cut. Falling bets on a September Fed rate cut may adversely impact BTC demand, possibly pushing BTC down toward $55,000.

Investors should remain alert amid possible changes to supply-demand trends. Stay updated with our latest news and analysis to manage exposure to BTC and the broader crypto market.

Technical Analysis

Bitcoin Analysis

BTC sat below the 50-day and 200-day EMAs, sending bearish price signals.

A break above the 200-day EMA and the $60,365 resistance level would support a move toward the 50-day EMA. Furthermore, a breakout from the 50-day EMA could bring the $64,000 resistance level  into play.

The NVIDIA Earnings Report, sentiment toward the Fed rate path, and BTC-spot ETF market flow trends require consideration.

Conversely, a drop below $55,000 could signal a fall to the $52,884 support level.

With a 44.99 14-Daily RSI reading, BTC could drop below $55,000 before entering oversold territory.

Ethereum Analysis

ETH sat well below the 50-day and 200-day EMAs, affirming bearish price trends.

An ETH return to $2,500 would support a move toward the $2,664 resistance level. A breakout from the $2,664 resistance level may bring $2,800 into play.

US ETH-spot ETF market-related news also requires consideration.

Conversely, an ETH break below the $2,403 support level could give the bears a run at the $2,124 support level.

The 14-period Daily RSI reading, 35.00, suggests an ETH drop below the $2,403 support level before entering oversold territory.