The crypto market has slowed down over the past few days, as investors await an action-packed week that could set the tone for mid-term market expectations.
Bitcoin has retracted from its all-time high of $123,200 — now trading at around $117,900 at this time of writing. In fact, $BTC has been trading on a narrow band ever since its first retraction from below its ATH.
The currency has been channel trading from $116k—$130k since July 15. While this may signal a lack of forward momentum, it also points out that bulls are not ready to give up new attempts at price discovery in the following weeks.
Daily trading volume has averaged around $60 billion for the past two weeks in the Bitcoin market. On the flip side, even massive sell-offs like last week’s $9 billion dumb weren’t enough to significantly move BTC lower.
Macro Sets the Tone
This week includes two, if not three, major events that could shape investor sentiment moving forward.
First of all, on Wednesday, Jerome Powell and the rest of the Federal Reserve members will announce the new (or old) interest rate decision in the U.S.
The Fed’s Chair has been under significant pressure from Donald Trump, who, now after passing the ‘Big Beautiful Bill,’ is demanding lower rates to make up for the deficit increase. However, growing consumer prices and the fact that we’re on the brink of the new tariff policy going into full effect will likely restrain the Fed from taking drastic decisions this month.
On that note, later in the week, the U.S. President’s deadline for tariff deals will finally be coming to a close. While countries like Brazil, Indonesia, and Vietnam are still scrambling for exemptions, major trading partners like Europe and Japan have settled for new deals.
Finally, the White House is set to release its digital assets report on Wednesday, a move that could redefine the regulatory landscape for crypto markets. The report is expected to unveil details on the newly established Strategic Bitcoin Reserve and the U.S. Digital Asset Stockpile.
U.S. markets appear optimistic about tariff deals, with the S&P 500 reaching yet again a new all-time high today. Meanwhile, the Fed maintaining the current 4.25% – 4.50% interest rate is the most expected outcome.
The developments of the White House digital assets report, however, could be the boost Bitcoin needs for new price discovery attempts. With crypto markets treading water, the upcoming report could either inject fresh momentum or deepen the sideways drift.
Bitcoin Outlook
The current $118,000 zone seems to be the most reliable support zone. Since first reaching that level on July 11, Bitcoin continued to find a home in that margin for most of the month. Meanwhile, the $116k area has served as a demand zone, where institutional money likely accumulated aggressively in July.
The RSI indicator corroborates the idea that $BTC will continue to range. The indicator is currently at 58 points, neither “oversold” nor “overbought”.
Meanwhile, the MACD points to a potential bearish divergence, given that the MACD line continues to diverge below the signal line, and the histogram bars are deepening in the red. That’s a textbook signal of fading bullish momentum on the daily timeframe.
Overall, the true story about Bitcoin’s path will likely be told throughout the week, as major economic and political events are set to shape investors’ risk appetite moving forward.
What to Keep an Eye Out for
Support Levels
- $118K: key short-term support
- $116K: institutional accumulation zone
Resistance Levels
- $123.2K: current all-time high
Indicators
- RSI at 58: neutral, favors continued range
- MACD: bearish divergence, momentum fading
Macro Events
- Fed rate decision midweek
- Tariff policy deadline approaching
- Digital assets report may impact sentiment and regulation
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