Bitcoin Falls Back After Attempt at $72K, but Fed, U.S. Data and Global Rate Cuts May Bring New All-Time Highs
Upcoming consumer price index and labor market data releases in the next few days could be key for what's next for bitcoin's price.
![Bitcoin price on June 6 (CoinDesk)](https://www.coindesk.com/resizer/wVjVExWBTEVhqj81UnrVA1p1egU=/567x297/filters:quality(80):format(jpg)/cloudfront-us-east-1.images.arcpublishing.com/coindesk/5MEB2WNADNCHTLZY4GISGLN2U4.jpg)
- Bitcoin spot selling on exchanges weighed on prices with a built up of short derivatives positions around the $72,000 level, one observer noted.
- Soft U.S. economic data, rate cuts could foreshadow dovish a Fed meeting next week.
Bitcoin (BTC) is increasingly compressed in a narrow range as the latest effort to rally past $72,000 stalled Thursday.
BTC rallied to $71,700 earlier during the day following the European Central Bank (ECB)'s rate cut, but quickly tumbled nearly dipping below $70,000 before bouncing to $70,600 at press time, down about 1% over the past 24 hours, CoinDesk's Bitcoin index data shows.
Well-followed market analyst Skew noted concerted spot selling activity on crypto exchanges Binance and Coinbase, and a simultaneous built-up of short perpetual futures positions on derivatives marketplaces, weighing on prices.
CoinGlass data shows a significant leverage built-up around the $70,000 and $72,000 price area that could be liquidated in case of a breakout from the narrow trading range in either direction.
![Bitcoin liquidation heatmap (CoinGlass)](https://www.coindesk.com/resizer/TkP0kgLxa_KV2Y5pi9zZrRXVs1g=/560x391/filters:quality(80):format(jpg)/cloudfront-us-east-1.images.arcpublishing.com/coindesk/7HTMGTISWRBLZJOJMTC26OTOEI.png)
The broader crypto market also experienced a pullback, with the CoinDesk 20 Index down 1% over the past 24 hours. Decentralized exchange Uniswap's token (UNI), oracle network Chainlink's LINK and layer-1 blockchain Near's NEAR declined 3%-5% in the same period.
Cosmos-based blockchain Injective's native token (INJ) defied the broader trend, gaining 5% following the project's tokenomics update that aims to make the asset more deflationary, reducing supply via token burns.
Despite bitcoin's struggle to get past the $72,000 level, analysts call for an imminent break upwards to new record highs as macro conditions are turning in favor of risk assets.
Central banks in the developed economies have started easing monetary policy, with the ECB and the Danish central bank both cutting benchmark rates by 25 basis today being the latest examples. Bank of Canada lowered rates earlier this week and its Swiss counterpart cut in March.
The big question going forward is if the U.S. Federal Reserve might join the rate cutting trend, and while some members of that central bank have suggested any monetary easing could be a 2025 story, recent data has shown softening in both inflation and economic growth. Tomorrow will bring the government's May employment report and a weak read could boost the odds of an imminent Fed rate cut.
And coming later this month will be the latest inflation data. "The CPI [Consumer Price Index] release next week might potentially be the trigger for a new all-time high for BTC," QCP said in a market update. "There may also be added momentum to the rally as the market prices in rate cuts."
Standard Charter's forex and digital assets research head Geoffrey Kendrick reiterated his $150,000 price target for BTC by year-end in a Thursday report, and noted the possibility of a breakout to new all-time highs in the next few days. "If tomorrow’s payrolls data are friendly I would expect a fresh all-time-high to be reached over the weekend,” he wrote.