Bitcoin Struggles Amid Market Uncertainty, Traders Expect Major MoveBitcoin (BTC) enters the final week of February in a tight trading range, facing growing concerns over a potential retest of the $90,000 support level. As market sentiment weakens and volatility sinks to historic lows, traders are closely watching whether bulls can regain control or if a larger correction is imminent.Key Market Factors Impacting Bitcoin This WeekSeveral macroeconomic and technical indicators are shaping Bitcoin’s price trajectory:Liquidity buildup around $90K and $94.7K suggests BTC is primed for a significant move.U.S. inflation data (PCE Index) on February 28 could drive volatility.Gold continues hitting all-time highs, while the U.S. dollar shows signs of strength.Bitcoin's implied volatility is near record lows, historically preceding major price movements.Network activity is slowing, raising concerns over market strength.Traders Eye Bitcoin’s $90K Support as Market Momentum WeakensBTC has struggled to break higher after the Bybit hack derailed last week’s upside attempt. According to trader CrypNuevo, the market remains range-bound, with key liquidity levels at $94.7K and $92.5K.Other analysts see a potential drop toward $90K if bulls fail to reclaim $98.4K on a daily close. Luca, another well-known trader, pointed to Bitcoin’s bull market support band, a key technical level that has held as support since October 2024, as an important area to watch.Stagflation Concerns and Fed Policy in FocusThe Personal Consumption Expenditures (PCE) Index, the Federal Reserve’s preferred inflation gauge, is set for release on February 28. This follows stronger-than-expected jobless claims data, raising concerns that the U.S. economy may be entering stagflation—a period of high inflation and slow economic growth.Historically, stagflation has not always been bearish for risk assets, with data from Mosaic Asset showing that the S&P 500 delivered positive real returns in 75% of such instances since 1930. However, Bitcoin’s reaction will largely depend on whether inflation fears lead to shifts in Fed policy expectations.Gold Hits New Highs While the U.S. Dollar StabilizesUnlike Bitcoin, gold continues to rally, setting new all-time highs and reinforcing its status as a global safe-haven asset. Despite a recent pullback, the U.S. dollar (DXY index) is attempting to reverse its downtrend, which could impact Bitcoin and risk assets if dollar strength returns.Bitcoin Volatility Hits Multi-Year Lows—A Big Move Incoming?On-chain data from Glassnode shows that Bitcoin’s 1-week realized volatility has dropped to 23.42%, nearing levels seen only a handful of times in the past four years. Similar volatility compressions have historically preceded major market movements, suggesting a breakout—either up or down—is on the horizon.Additionally, network activity is slowing, with active addresses shrinking and Bitcoin ETF inflows declining. CryptoQuant analysts have noted similarities to September 2023 and the 2017 cycle peak, where a drop in unspent transaction outputs (UTXOs) signaled a cooling market.What’s Next for Bitcoin? Key Levels to Watch$90,000 Support Test: A failure to hold this level could trigger a deeper correction.Break Above $98,400: Would invalidate the bearish outlook and signal a return to bullish momentum.Impact of PCE Data: If inflation data spikes higher, markets may push back expectations for Fed rate cuts, influencing Bitcoin’s short-term price action.With sentiment turning neutral and Bitcoin’s historical volatility nearing record lows, traders expect a decisive move in the coming weeks, making February’s close and March’s early price action crucial for Bitcoin’s next trend direction, according to Cointelegraph.
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