After the price of Bitcoin dropped to $100,000 last Thursday, in one of the largest daily declines this month, it made a strong recovery on Friday to surpass $105,000. Despite this rebound, the price is still below its levels at the beginning of the week, raising questions about whether these fluctuations are just a temporary setback or the beginning of a larger decline.
Nonetheless, many investors see any price drop now as an ideal buying opportunity, especially for those adopting a medium or long-term investment perspective.
From political tension to economic data: What affects Bitcoin?
The market experienced a sudden drop on Thursday coinciding with the public feud between Elon Musk and Donald Trump. Although this feud is not directly related to cryptocurrencies, it has affected investor sentiment. Partial liquidations in ETF funds and profit-taking after historic price peaks also contributed to the downturn.
However, the situation improved on Friday supported by the better-than-expected U.S. jobs report for May (NFP), easing concerns about a weak labor market. Additionally, Donald Trump's call for a full percentage point interest rate cut has heightened interest in alternative assets like Bitcoin as an investment refuge. The upcoming economic data, particularly inflation numbers on Wednesday, is expected to play a crucial role in determining Bitcoin's short-term trajectory. If the numbers are below expectations, calls for monetary policy easing may increase, supporting digital assets.
Technical Analysis: Opportunity or Risk?
Technically, Bitcoin has been trading within a downward channel since reaching its all-time high on May 22. The drop on Thursday was a reaction to the upper limit of the channel, while the rebound on Friday came from the lower limit. As the weekend approaches, the price tested the upper limit again, indicating a potential short-term resistance.
As long as the $100,000 level remains strong support, any pullback may be a good opportunity for medium to long-term investors. If the $106,000 level is breached, it could indicate the end of the downward channel, pushing the price towards $110,000 or even $112,000, bringing Bitcoin back onto a new upward trajectory.