Daily News: Bitcoin Faces $111.5k Test Ahead of PCE Data
BTC hovers at critical support as positioning pressures mount, while global markets focus on inflation and central bank politics.
🪙 Crypto Market Update
Bitcoin slipped back toward the $111,500 danger zone after failing to hold above $113,000. Much of the move appears tied to retail positioning and market maker flows rather than fresh fundamentals.
The PCE inflation report due today looms large — a hot print could drag BTC toward $107,000, while a softer number may fuel a rebound. Technically, BTC broke below a wedge formation, and reclaiming that range plus yesterday’s highs is key. Failure to do so leaves downside risk.
Liquidation data highlights large short squeezes still lurking around $114k, with leveraged traders maintaining a heavy short bias. Positioning among top traders, however, remains long with an average entry near $118k — suggesting confidence in a snapback rally. ETF flows also show fresh inflows after mid-August outflows.
In the short-term, BTC needs to clear $114–115k to shift momentum. A close above $117–119k this week would strengthen the medium-term bullish case. Conversely, a breakdown below $111k could accelerate losses.
🌍 Global Macro & Markets
ECB minutes revealed divisions on inflation risks — some policymakers see downside pressures, while others warn services inflation remains sticky. The bank left rates unchanged at 2% in July and is expected to stay on hold in September, with only minimal cuts priced for year-end.
In the U.S., Q2 GDP was revised higher to 3.3% (from 3.0%), while jobless claims ticked in slightly better than expected at 229k. The Fed remains under political pressure, as member Lisa Cook challenges her potential dismissal in court, intensifying tensions between Trump and the central bank.
In FX, EUR/USD edged higher as Fed independence concerns weigh on the dollar, while USD/JPY continues consolidating between 146–148.5. Markets increasingly expect Fed rate cuts and potential BOJ tightening later this year, setting up yen strength in the months ahead.
Commodities gained on dollar weakness: gold climbed modestly, silver held above $38, and Brent crude rose to $67.8. U.S. bond yields eased, with the 10Y at 4.22%, reflecting safe-haven demand and softer inflation expectations.
📌 Key Takeaways
Bitcoin tests $111.5k, with $107k risk if PCE inflation is hot
Retail positioning remains short-heavy; top traders still long around $118k
ETF inflows returning, offering medium-term support
ECB minutes highlight division on inflation; Fed independence under political stress
Dollar weak, gold/silver firm, oil slightly higher
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