Bitcoin (BTC) begins another week in bullish mood as the obstacles line up to shape the price trajectory.
Cointelegraph presents five factors that determine where the BTC/USD may go in the coming days, and what traders should look out for.
All eyes on the Fed and US inflation
Stocks hit records last week with the S&P 500 reaching all-time highs. Despite a lesser overall impact on Bitcoin, movements in the macro markets are still more than capable of overflowing into the cryptosystem.
The upward momentum continued on Monday, with stock futures rising, but with a sense of fear building over the upcoming U.S. Federal Reserve speech.
The markets were waiting for news on inflation, which rumors say could reach 4%.
This would be a perfect storm to lift the safe havens, according to analysts, in an environment that has already sent the US dollar index to its two-year lows and flooded the market with excess liquidity from quantitative easing.
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The news will come from Federal Reserve Chairman Jerome Powell during his annual Economic Policy Symposium in Jackson Hole, Wyoming, on Thursday.
„More clarity will no doubt be sought through this week’s Jackson Hole Symposium,“ Ben Emons of macro-analysis firm Medley Global Advisors told Bloomberg on Monday.
U.S. futures were up; Asia, meanwhile, set a bullish tone as Washington said it would not block China’s WeChat social network, and owner Tencent shares rose more than 4% as a result.
Analyst points to USD 9,600 to buy in case of a fall
In short order, Bitcoin pleased the analysts at the beginning of the week. For Cointelegraph Markets analyst Michaël van de Poppe, a move to lower levels was now less likely after the BTC/USD avoided a repeat of levels below USD 11,500 on Sunday night.
In a video of Sunday’s trading analysis, van de Poppe added that, in the event of a drop, the level to „buy“ that needed to be paid attention to would nevertheless be below USD 10,000.
„The actual level I’m looking at for buy levels in case of a drop is between $9,600 and $9,900,“ he summarized.
Concern about a fall below five figures had become less common among commentators; Van de Poppe mostly dismissed rumors of a decline below $8,000.
The last time Bitcoin traded below $10,000 was in late July.
Bitcoin’s Difficulty Reaches a New Record
The difficulty was adjusted by rising 3% to reach new historical highs, but the trend in the hash rate was less.
According to data from the monitoring resource BTC.com, the difficulty increased by 3.6% on Monday to reach 18.17 billion.
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The new record suggests that the miners‘ participation in the network is stronger than ever, and the competition is reflected in how burdensome it is to solve the equations in the blockchain.
The difficulty is automatically adjusted and is an essential feature of Bitcoin System as self-regulating hard money. The emission remains fixed regardless of the high or low difficulty.
Meanwhile, the hash rate decreased by about 8% in the last seven days, according to estimates, currently hovering around 119 exahashes per second (EH/s).
Given the imprecise nature of the hash rate measurements, it is likely that the number will normalize after the hardship adjustment, continuing a broad upward trend instead, as just after the May halving, miners‘ earnings were reduced by 50% overnight.