- Bitcoin price fell over 2% in European trading due to stronger Spanish inflation.
- BTC traders are fleeing their positions as the market turmoil is set to peak for the year.
- Expect bitcoin price to sell off in search of support towards $21,969.
Bitcoin (BTC) price falters in European trading as this volatile week kicks off with surprise Spanish inflation data. Markets were forecasting a decline from 5.7% to 4.97%. Instead, inflation jumped to 5.8%. This confirms what central bankers have been yelling about for the past few weeks and what markets have been ignoring. Is reality catching up this week?
Bitcoin price set to decline as a wave of headwinds emerge
Bitcoin price is making traders nervous as this week could be the toughest for the first quarter of 2023. Not only will the US Federal Reserve, the European Central Bank and the Bank of England release their forecasts and monetary policy, but the US jobs report is also due out on Friday. There could not be more variables available to trigger whipsaw moves on the chart. These events will make trading BTC difficult and could force many traders to end the week with a loss depending on where BTC is trading at the official closing bell on Friday night.
BTC, meanwhile, received a false breakout and rejection against $23,878.62, slumping this Monday as the rally was pressured by profit-taking. The Relative Strength Index (RSI) is also declining and will break below the overbought barrier in search of some consolidation. Expect BTC to fall to nearly $21,969 by the end of this week once all central bank events and the US jobs report are factored in.
BTC/USD daily chart
Should the bulls withstand current events, or should a central bank turn very supportive, signaling that inflation can only go down from here, markets would jump onto this positive narrative. Expect a break above $23,878 and a higher bounce would reconfirm the rally moving away from this crucial level. Although $28,695 remains very high and elevated, the profit level will be back on the table earlier this week.
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