Bitcoin is holding at $117,761, up 8% this week, while the U.S. dollar seems to be weakening. The WSJ Dollar Index, which tracks the dollar against major currencies, closed at 94.73, slightly above a recent low and down 10.4% from its 2022 high. The dollar's weakness is driving capital flows into digital assets as investors seek alternatives to traditional stores of value.
The technical factors are very strong. Bitcoin has broken out of the symmetrical triangle pattern and surpassed the Fibonacci retracement levels of 0.382 and 0.5. The price is consolidating above $116,951 - a key support area. The 50-period SMA on the 4-hour chart is at $110,527 below and is supporting the trend.
Momentum indicators support the bullish trend. The RSI is at 75.5 - overbought but not diverging - so until a bearish candle appears or trading volume decreases, the resistance line at least remains upward.
Macro Forces Synchronizing: Fed Uncertainty, ETF Hopes
The Federal Reserve (Fed) is deeply divided on interest rates, and the dollar is in a precarious state. Some want to wait, while others see inflation risks requiring further tightening. The market is pricing in a 50% chance of rate cuts in July - an event that has traders worried.
In the cryptocurrency space, the picture is clearer. Hopes for an ETF are rising despite the SEC delaying Grayscale's Digital Large Cap ETF. Analysts expect more cryptocurrency ETFs to emerge as institutions begin to view Bitcoin as digital gold. This makes BTC a better hedge against interest rate volatility and geopolitical risks.
Meanwhile, Peter Schiff is calling on people to sell Bitcoin for silver and the market is ignoring him. BTC has risen 6% since his warning, and many are citing capital flows from institutions and strong technical indicators as reasons to continue holding.
Trading Setup And Risks To Watch
Bitcoin price predictions remain optimistic, thus, to continue trading, here is the setup:
Entry Point: Drop to $116,950 (Fib 0.5)
Stop Loss: Below $112,500 (0.382)
Target: $121,378 (0.618), $124,682, $127,681
This is a Fibonacci convergence point and a trend. Look for signs of reversal - pivot tops or Doji - at resistance levels. However, risks remain. The minutes from the Fed meeting on July 12 could be volatile if the outlook turns hawkish. And the U.S. government's tariff policies - especially regarding BRICS countries like South Africa - will indirectly affect global risk sentiment and cryptocurrencies.
Conclusion
The technical breakout of Bitcoin, a weak dollar, and increasing expectations for an ETF mean that prices could rise even more. Whether BTC can reach $300,000 this year depends on many factors - Fed policy, institutional acceptance, and macroeconomic volatility. But for now, the bulls are in control.