Crypto's Bullish & Bearish Macro Signals, Bitcoin & Ethereum's Technical Picture

Nathan Peterson (0:11)

Hello, and welcome to Crypto Corner. This year, host Nathan Peterson. I'm the Director of Derivatives Research and Strategy at the Schwab Center for Financial Research. Today, I just wanted to take a look at what seems to be kind of a push-pull bullish versus bearish dynamic that's going on right now with crypto overall, but Bitcoin in particular. So, if we start on the bull side of the equation, first of all, seasonality right now is, you know, historically, in Bitcoin's limited history of roughly 17 years here, historically, this has been one of the most bullish seasonal periods for the price of Bitcoin, that being October being one of the best months, Q4 being seasonally bullish and the four-year cycle where, if you look at the four-year having cycle around this time frame seasonally, is that the price of Bitcoin would trough. And we have seen some lift out of Bitcoin here over the past month or so.

So seasonality is certainly working in the bulls' favors there. There's also bullish technicals or at least technical healing and improvement that we've seen over the past six weeks. We're going to touch on technicals a little bit later.

And then you have also working against Bitcoin on the bearish side of the equation is obviously rising interest rates. Now, Bitcoin is a store of value and it does not provide a yield. There is some yield that you can get out there actually, of course, with your staking and everything, but within the crypto world. But because interest rates moving higher like that, that also draws. It's not good for gold. It's not good for store of value type of assets like Bitcoin. And today on the 10 year, we did technically hit a new cycle high of 5.34 percent. And then the other factor working against Bitcoin on the bearish side is when you have a Fed that's basically in a rate hiking cycle. Now, cycle with parentheses around it just because we don't know how many we're going to get. We might get two or three. This is not 2002, 2003 when the Fed was aggressively moving from zero up to 5% to combat 9% CPIs, etc. that were coming in due to COVID and supply chain issues, etc. However, it just generally Bitcoin's price tends to react more favorably when there is looser monetary policy easing Fed cut cycle. So those two forces are really just kind of this push-pull dynamic where you would think that Bitcoin would be responding better in October as we just haven't seen. So today, we're getting hit because of interest rates going up, oil was a little bit higher, some volatility around tech there as well. And if you look at Ethereum, Ethereum tends to be higher beta than Bitcoin. So Ethereum is almost down 5% today. And there is another story that perhaps is impacting or contributing to that outsized decline there in Ethereum. And that is Tom Lee, chairman, Tom Lee, FunStratz, Tom Lee. I think if you're an equity trader, you probably are familiar with Tom Lee. But he is a chairman on Bitmine Immersion, BMNR. It is a digital asset treasury company that's been accumulating Ethereum since, basically a little over a year now. And when they announced that they were going to be accumulating Ethereum last June 2025, they have been buying Ethereum every week. But Tom Lee last night basically said that they are approaching 5% of all the Ethereum in circulation. And based on how much that they have been buying, they're going to stop in roughly 6 to 7 weeks when they reach that 5% threshold for Ethereum. So if you look at the chart of Ethereum, you can see that's kind of taking a pretty sizable hit there, as is BMNR, obviously, they are highly correlated because of that relationship that they have. But let's look at the technicals here on Bitcoin. So I wanted to touch on one of the other bullish factors within the technicals. Now, not only is seasonality there, but if you look, the price of Bitcoin has made this push, obviously, above the 200-day simple moving average. It's retested multiple times at that 200-day simple moving average. It hasn't really breached it. We got another push higher about three weeks ago, and we topped out around 87, 700-ish around there. So that's your resistance. That's the first level of resistance that the bulls would want to see the price of Bitcoin overcome.

When you get beyond 87, 7, roughly in 90 to 91, that's another area of resistance. So if you're bullish in the coming weeks, you probably want to see interest rates come down and or oil prices come down. That tends to be more conducive for the price of Bitcoin. But then technically you'd like to see it get up there and clear 91 That would be basically the highest level since January and technically incrementally bullish. But also pay attention to the 50-day simple moving average, which has now from the underside crossed above the 200-day simple moving average, that's known as a golden cross in technical analysis land. And so that tends to be another bullish indicator. The death cross is the inverse of that. So you can just see that there are multiple indications on the charts, that the technicals are firming up, they're improving.