Bitcoin (BTC) struggled to remain above $44,000 on Thursday, as U.S. stocks fell further following hawkish remarks by a Federal Reserve official.

Responding to a surprisingly high rate of inflation, Federal Reserve Bank of St. Louis President James Bullard said he supported raising interest rates by a full percentage point by July, Bloomberg reported. His comments came after the U.S. Labor Department on Thursday reported that the consumer price index (CPI) for January hit 7.5%, which was higher than what analysts expected earlier.

Bitcoin started falling as stock prices fell further from an initial drop earlier in the day. At the time of publication, the oldest cryptocurrency was changing hands at $43,807 down 1.4% in the past 24 hours, according to CoinDesk data.

The next level of resistance is at $46,710, which represents a 38% retracement of the previous two month-long downtrend. Buyers could start to exit positions as BTC approaches resistance heading into the Asia trading session.

For now, momentum signals are improving on intraday charts, although price action is volatile following the U.S. inflation report. Stronger resistance is seen at $50,000 if buyers sustain short-term momentum.

BTC price looks set for another breakout as it consolidates with lower highs and higher lows. The fact that the daily close above $44,088 happened yesterday proves bulls are in control and will keep a tight lid on any profit-taking. Expect some resistance to come in short-term from the monthly R1 at around $46,740, but the ultimate target for the end of this week will be $48,760, prepositioning for a breach above $50,000 next week. Pullbacks could stabilize in the $40,000-$43,000 range.

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Feb 11 2022