Bitcoin below key resistance as markets brace for US inflation data

Bitcoin is holding steady below a key technical resistance level, trading around $81,000 after pulling back from weekend highs near $82,500, as investors assess renewed tensions in the Middle East and await crucial US inflation data.

Risk appetite weakened slightly on Tuesday after overnight reports suggested Donald Trump was considering additional military options against Iran, underlining how fragile the geopolitical backdrop remains.

Trump warned that the ceasefire with Iran was “on life support” after largely rejecting Tehran’s response to the latest US peace proposal, while the Strait of Hormuz remains effectively closed.

The renewed tensions have pushed oil prices sharply higher, with Brent crude rising above $105 per barrel. The increase in energy prices is reigniting inflation concerns, sending US Treasury yields higher and tightening financial conditions — a less supportive backdrop for risk assets such as crypto and growth equities.

What to expect from US CPI data?

Attention is now turning to US CPI data for April. Headline inflation is expected to rise sharply again following March’s jump, driven largely by elevated energy prices linked to the Middle East conflict.

Monthly CPI is forecast to rise 0.6% in April, following a 0.9% increase previously, while the annual rate is expected to climb to 3.7%, its highest level since 2023, up from 3.3%. However, core inflation — which strips out food and energy — is expected to remain unchanged at 2.7%. This is still well ahead of the Fed’s 2% target and could rise further.

A hotter-than-expected inflation reading could reinforce expectations that the Federal Reserve will maintain a higher-for-longer policy stance, which would likely weigh on Bitcoin, US equities and broader risk sentiment.

US futures were modestly lower ahead of the data, led by weakness in the tech-heavy Nasdaq after US indices reached fresh record highs in the previous session.

Institutional demand remains supportive

Despite the more cautious macro backdrop, institutional demand for Bitcoin remains relatively firm.

On the corporate side, Strategy announced the purchase of another 535 BTC for its treasury reserve, taking total holdings to 818,869 BTC.

Meanwhile, Bitcoin ETFs began the week positively, recording $27.25 million in net inflows on Monday following inflows of roughly $616 million last week.

Persistent buying from institutional investors and corporate treasury demand continues to help absorb supply, providing an underlying source of support for prices even as macro risks intensify.

BTC technical analysis

BTC/USDT has traded within an ascending channel since early February. The price has risen above the multi-month falling trend line from the October 126k record high and is currently testing resistance at the 200 SMA and upper band of the rising channel.

Buyers supported by the RSI above 50 will need to rise above 82.5k, the 200 SMA, to gain traction towards 85K, the 38.2% Fibonacci retracement of the 126k high and 60k low. Above here, 94k, the 50% Fib level comes into focus ahead of $100k, the psychological level.  

Failure to retake the 200 SMA could see the price fall back towards 75k, the 23.6% Fib level, and the midpoint of the rising channel. Below here, the 50 SMA comes into focus at 74k, ahead of 71k, the lower band of the rising channel. A break below 65k. The April low creates a lower low.  

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