How can BTC break through its all-time high?
The market is very sensitive to inflation trends, especially the Fed's interest rate path. Traders currently expect the Fed to cut interest rates only once this year and fully price in the first rate cut in December, with only a 10% chance of a rate cut in July and about an 80% chance of a rate cut in November.
Thursday's US gross domestic product (GDP) showed that the economy is slowing, rekindling hopes that the Fed may cut interest rates later this year. Meanwhile, the US Department of Labor reported an increase in the number of people applying for unemployment benefits. BTC rebounded on the day but remains under pressure below the $70,000 mark.
The current short-term momentum in gold prices favors bears as the relative strength index (RSI) remains bearish after falling below 50 on Wednesday. Traders are currently focusing on the US PCE inflation data for April, which may determine the direction of BTC. If bulls recapture the psychological level of $70,000, further gains are expected. The next target will be $72,000, followed by the year-to-date high of $73,777, followed by the $79,000-81,000 barrier.
On the other hand, if the RSI drops below 50 and BTC breaks below the 30-day moving average (MA) at $65,500, it could pave the way for the bears to challenge the May 11 low of $60,180 and the May 1 cycle low of $56,555.
