Bitcoin (BTC) reclaimed the $65,000 mark and is up 1.78% in the last 24 hours and 4.38% in the last seven days. Sentiment around BTC has turned positive alongside other risk assets as the US inflation data came softer. US inflation fell 0.4% in June, for a seasonally adjusted annual rate of 3.5% over the year, driven by rapidly falling energy costs, according to a new report released by the US Bureau of Labor Statistics. 

Inflation rose by 0.5% in May before declining by 0.4% in June. The change is the largest one-month shift in prices since April 2020, BLS reported. The overall May inflation was 4.2%, showing a notable fall in June. 

Generally, slower inflation benefits Bitcoin and other risk assets as it may reduce the pressure from the US Federal Reserve to hike interest rates. 

Fed Outlook Limits Crypto Gains

Investors remain interested in the “higher for longer” prospects of interest rates. High borrowing rates can hinder the flow of capital in the financial system, potentially leading to a decline in demand for speculative assets like cryptocurrencies.

Traders on Polymarket predicted a 94% chance that the Federal Reserve will keep interest rates unchanged at its July meeting. This helped curb concerns about an imminent policy shock, but also revealed that markets have not been fully convinced of a near-term easing cycle.

Oil prices fell below $90 today, easing inflation concerns amid diplomatic efforts in the Middle East. Brent crude futures declined 0.80% to $88.51 per barrel. US West Texas Intermediate (WTI) edged lower by 0.46% to $82.10 per barrel.

ETF Inflows Show Cautious Demand

According to SoSoValue, the US spot Bitcoin ETFs reported $226.92 million in net inflows on July 20, marking a fifth consecutive session of inflows. BlackRock's IBIT drew $116.48 million, Ark Invest's ARKB took in $72.74 million, and Grayscale Bitcoin Mini Trust (BTC) recorded $41.45 million in net inflows. 

Funds also flowed into Fidelity's FBTC, Bitwise's BITB, Morgan Stanley's MSBT, and VanEck's HODL, while Grayscale's GBTC saw $45.4 million in net outflows.

CoinMarketCap’s Crypto Fear and Greed Index shows a reading of 37, in “fear” territory. However, the sentiment has significantly improved from the month's start when it was in the “extreme fear” range at 18. 

Also Read: Bitcoin News Today: BTC Holds Near $64K as Oil Surge and AI Jitters Shake Markets

Technical Structure

BTC edged above $65,000 on Tuesday, following a breakout above the 50-day Exponential Moving Average (EMA) at $65,051. 

Despite the breakout, BTC remains well below the 200-day EMA at $74,693, which continues to cap the broader trend. 

Momentum is positive, as the Relative Strength Index (RSI) hovers near 57 and the Moving Average Convergence Divergence (MACD) holds above the zero line, indicating that buyers retain an advantage but face a higher-timeframe barrier. 

On the upside, immediate resistance is at $70,000, with a subsequent hurdle aligning near the 200-day EMA at $74,693.

On the downside, support is seen at the 50-day EMA at $65,051, and a deeper pullback would expose the horizontal floor at $60,000.

FAQs

1. Why did Bitcoin reclaim the $65,000 level?

Bitcoin moved above $65,000 after softer US inflation data improved sentiment across risk assets. BTC also gained support from positive ETF inflows and a breakout above the 50-day EMA.

2. How much inflow did US spot Bitcoin ETFs record?

According to SoSoValue, US spot Bitcoin ETFs recorded $226.92 million in net inflows on July 20. BlackRock’s IBIT led with $116.48 million, followed by ARKB with $72.74 million.

3. Why is the Fed outlook still limiting Bitcoin gains?

Markets still expect interest rates to remain elevated for longer, which can reduce liquidity for risky assets. Polymarket traders assign a 94% chance that the Fed will keep rates unchanged in July.

4. What does the Crypto Fear and Greed Index show?

CoinMarketCap’s Crypto Fear and Greed Index stands at 37, still in the “fear” zone. However, sentiment has improved from the month’s start, when the index was at 18 in “extreme fear.”

5. What are the key Bitcoin support and resistance levels?

Bitcoin faces immediate resistance near $70,000, followed by the 200-day EMA at $74,693. On the downside, support sits near the 50-day EMA at $65,051, with deeper support around $60,000.