(MENAFN- Daily Forex) Advertisement Test out this trade suggestion with a top-rated BTC/USD broker Get Started Bullish view
- Buy the BTC/USD pair and set a take-profit at 22,700.
- Add a stop-loss at 20,566.
- Timeline: 1 day.
Bearish view
- Set a sell-stop at 21,200 and a take-profit at 20,000.
- Add a stop-loss at 22,500.
The BTC/USD price continued its recovery as the US dollar and the VIX index retreated. bitcoin made a strong comeback from last week's low of $18,515 to a high of $22,000 during the weekend. Focus shifts to the upcoming US inflation data and Ethereum merge.US inflation and Ethereum merge
The BTC/USD price has had a strong recovery in the past few days. This recovery has coincided with a significant drop of the US dollar index, which has dropped from over $110 to $108. In addition, it coincided with a rebound of American stocks.
The four main indices, including the Dow Jones, Nasdaq 100, S&P 500, and Russell 2000, have gained in the past three straight days. In the past few months, there has been a close correlation between American indices and Bitcoin.
The next key data to watch will be on America's inflation, which is scheduled for Tuesday this week. Economists expect the data will show that inflation eased slightly in August as gasoline prices dropped.
Other important parts of America's inflation like airfares, used cars, hotels, and rents have also eased slightly in the past few weeks. Food prices have remained at an elevated level due to the ongoing drought and war in Ukraine. Still, the Federal Reserve will likely maintain a hawkish tone in the coming months. BTC tends to underperform in a period of hawkish Fed.
Bitcoin and other cryptocurrencies will also react to the upcoming merge, which is scheduled for Wednesday this week. This merge, which is the biggest event in the blockchain industry, will see Ethereum transition from a proof-of-work (PoW) into a proof-of-stake (PoS) network. PoS is usually more climate-friendly than PoW. There is a likelihood that the BTC/USD pair will react to how the merge happens.BTC/USD forecast
The four-hour chart reveals that the BTC/USD pair has been in a strong bullish trend in the past few days. In this period, the pair managed to move above the important resistance level at 20,566, which was the highest point on August 30. The pair has also moved to the 38.2% Fibonacci Retracement level and the 25-day and 50-day moving averages.
Therefore, with the merge upcoming, there is a possibility that Bitcoin will continue rising as bulls target the next key resistance level at the 50% retracement at 22,645. The stop-loss for this trade will be at 20,566.
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