(MENAFN- Daily Forex) Bearish view

• Sell the BTC/USD pair and set a take-profit at 110,000.
• Add a stop-loss at 123,000.
• Timeline: 1-2 days.

Bullish view

• Buy the BTC/USD pair and set a take-profit at 123,000.
• Add a stop-loss at 110,000.

Bitcoin price pulled back in the overnight session as traders began to book profits after the recent surge and as the“Crypto Week” continued. The BTC/USD pair pulled back to 116,000, down sharply from the year-to-date high of 123,288.

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Bitcoin's plunge happened even after Donald Trump started to promote the Crypto Week, where politicians in Washington are considering three key crypto-related bills. They are considering the GENIUS Act, which streamlines the stablecoin industry.

The bill sets the top terms and conditions for companies issuing stablecoins such as regular disclosures and auditing. Companies should back their holdings with either cash or short-term Treasuries.

Some companies have hinted that they will issue their stablecoins if the bill passes. For example, Citigroup confirmed that it was working on such a product.

The House and Senate are considering the CLARITY Act, which separates the roles of the SEC and the CFTC in the cryptocurrency industry. They are also working on a bill to ban CBDCs.

Bitcoin also pulled back, even as data indicated increased demand from Wall Street investors. Spot ETF inflows have continued rising this year, with the cumulative figure hitting over $52 billion.

The iShares Bitcoin ETF now holds over $85 billion in assets and is BlackRock's most profitable fund. It is also closing the gap with GLD, the biggest gold ETF.

Bitcoin also pulled back after the US published the latest consumer inflation data. That figure showed that the core consumer price index (CPI) rose 0.2% MoM in June, lower than what analysts were expecting.

EURUSD Chart by TradingViewBTC/USD Technical Analysis

The daily chart shows that the BTC/USD pair has pulled back this week. This decline happened after it formed a shooting star candlestick pattern, a common bearish reversal sign.

The decline also occurred due to mean reversion, a phenomenon where an asset returns to its historical averages. In this case, the price is much higher than the 50-day moving average at 108,180.

It also wants to retest the key support at 110,000, the upper side of the cup-and-handle pattern. Therefore, the BTC/USD pair will likely retreat as sellers target the support at 110,000 and then resume the uptrend. The bearish outlook will be invalid if the price rises above the year-to-date high of 123,288.

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