Bitcoin (BTC<\/a>) starts a pivotal week on a firm footing as bulls succeed in wiping out weeks of losses.<\/p>\n After closing the latest weekly candle at $21,800, its highest since mid-August, BTC\/USD is back on the radar as a long bet.<\/p>\n The end to an extended period of downside interspersed with sideways price action now appears firmly at an end, with volatility expected to form a major theme in the coming days.<\/p>\n In fact, few weeks in Bitcoin\u2019s history have been as hectic as this one is likely to be. <\/p>\n In addition to the Ethereum Merge on Sept. 15, the United States inflation trend will come under scrutiny on Sept. 13 with the release of August Consumer Price Index (CPI) data. The recipe for unpredictability is there.<\/p>\n How will Bitcoin weather the storm? While the macro picture looks muddy for risk assets as the United States dollar surges, on-chain data continues to point to a price bottom already in the making.<\/p>\n In addition, Bitcoin\u2019s network fundamentals are poised to hit new all-time highs this week, underscoring miner resilience and recovery, along with conviction over profitability.<\/p>\n Cointelegraph takes a look at several of the main areas to watch as Bitcoin gives \u201cSeptembear\u201d a run for its money.<\/p>\n The latest weekly close provided some much-needed relief for Bitcoin bulls. <\/p>\n After weeks of miserable performance<\/a>, BTC\/USD finally managed to seal a convincing week\u2019s gains, even avoiding a last-minute correction into the candle close, data from Cointelegraph Markets Pro<\/a> and TradingView<\/a> shows.<\/p>\n As such, at just above $21,800, the Sept. 11 event formed a solid foundation for a week due to deliver considerable volatility. <\/p>\n At the time of writing, that level is forming a consolidation zone, coinciding with an important trendline in the form of Bitcoin\u2019s realized price. According<\/a> to on-chain analytics firm Glassnode, this currently sits at approximately $21,770.<\/p>\n BTC\/USD has yet to tackle more significant bear market levels lost as support last month, chief among them the 200-week moving average, which is now near $23,330.<\/p>\n A spike to $22,350 on Bitstamp overnight nonetheless caught traders\u2019 attention, furthering existing calls for upside to continue.<\/p>\n \u201cThis just was preliminary supply at 22300,\u201d popular Twitter account Il Capo of Crypto wrote<\/a> in one of several recent updates:<\/p>\n \u201cStill thinking 23k is likely. Then we see reversal.\u201d<\/p><\/blockquote>\n A further tweet nonetheless cautioned<\/a> that \u201cmajor resistances\u201d are now coming into play across Bitcoin and altcoins.<\/p>\n \u201cIn my opinion, we see a last leg up of 5-7% soon, then ltf distribution, then nuke. Get ready,\u201d it stated.<\/p>\n In a sign of the coming volatility beginning, fellow trader Cheds noted<\/a> that Bitcoin tagged its upper Bollinger Band on daily timeframes, the bands now slowly spreading to make way for a wider trading range.<\/p>\n One of the two main talking points for the week in BTC price action comes from a familiar source: the United States Federal Reserve. <\/p>\n CPI data is due for August, and hopes are resting on the decreasing inflation trend continuing<\/a> after July\u2019s print showed a peak having formed.<\/p>\n Massive week coming up;<\/p>\n – CPI Data, which will most likely give a direction towards the FED.<\/p>\n – $ETH<\/a> merge is approaching, which is one of the biggest events in blockchain in the past years.<\/p>\n – Climax on strength of the $DXY<\/a> potentially approaching.<\/p>\n Fire.<\/p>\n \u2014 Micha\u00ebl van de Poppe (@CryptoMichNL) September 12, 2022<\/a><\/p><\/blockquote>\n Should that be the case, it will be a boon for risk assets suffering heavily at the hands of a surging U.S. dollar. <\/p>\n According<\/a> to CME Group\u2019s FedWatch Tool, the Fed\u2019s Federal Open Markets Committee is nonetheless likely to put in a repeat 75-basis-point interest rate hike at its September meeting next week.<\/p>\n For dollar watchers, however, there is already reason to believe that the risk asset comeback should cement itself in the coming days. <\/p>\n The U.S. dollar index (DXY), fresh from twenty-year highs<\/a>, has fallen nearly 2.7% in just four days.<\/p>\n My calculator cannot count the number of negative comments I received after tweeting the $DXY<\/a> Sell Signal. https:\/\/t.co\/ENGqkgkb1v<\/a> pic.twitter.com\/r4VlfIVvSR<\/a><\/p>\n \u2014 Trader_J (@Trader_Jibon) September 12, 2022<\/a><\/p><\/blockquote>\n \u201cOne thing which makes me doubt my downside bias for Bitcoin & Crypto in general post the ETH merge even, is DXY,\u201d analyst Mark Cullen, creator of trading resource AlphaBTC, revealed<\/a>:<\/p>\n \u201cWe see potential for 3 drives of [bear] divergence formed on the RSI & the Sept FOMC is next Wed. I wonder if we see $DXY break the parabola & push risk assets up.\u201d<\/p><\/blockquote>\n Phoenix Copper executive Donald Pond, meanwhile, called the USD and DXY chart \u201cthe most important out there.\u201d<\/p>\n \u201cThe dollar is far too strong atm, and has been killing everything else,\u201d he tweeted<\/a> on the day. <\/p>\n \u201cIt\u2019s dropped quickly over last few days, but is still in a strong uptrend. No sustainable bounce for markets until trend breaks.\u201d<\/p>\n Complementing the encouraging inflation data is a purely internal price trigger \u2014\u00a0the Ethereum Merge<\/a> \u2014 due around Sept. 15.<\/p>\n The event, now set to become a reality after months of uncertainty, sees Ethereum as a network transition from proof-of-work (PoW) to proof-of-stake (PoS)<\/a> as its hashing algorithm.<\/p>\n Hype has been building on social media and beyond, and now, analysts are wondering what the immediate aftermath will be \u2014 specifically, whether investors will \u201csell the news\u201d and bring markets lower immediately once the Merge completes.<\/p>\n Huge week for the #Ethereum<\/a> and #Crypto<\/a> community with the upcoming Merge<\/p>\n These events tend to create more liquidity, which can be used to the whales advantage via engineering certain moves and looks <\/p>\n Do not rush into positions if your not already in one ‼️<\/p>\n \u2014 Crypto Tony (@CryptoTony__) September 12, 2022<\/a><\/p><\/blockquote>\n everyone larping about if they should long the merge or short the merge<\/p>\n feels like one of these games where the best move is not to play<\/p>\n \u2014 Udi Wertheimer (@udiWertheimer) September 12, 2022<\/a><\/p><\/blockquote>\n In a dedicated update released<\/a> on Sept. 10, trading platform DecenTrader stressed the need for caution and avoidance of an \u201cup-only\u201d mindset.<\/p>\n \u201cIt is important to remember that there are multiple potential headwinds that could turn things in favour of the bears, namely bugs in the Merge code, a significant proportion of the Ethereum network moving to a fork taking market value with it, as well as Macro headwinds from the US August CPI data next week,\u201d it wrote:<\/p>\n \u201cIt\u2019s also important to remember that overall, there remains macro and geopolitical systematic risk which might halt the most bullish narrative for ETH. Lets see if price can hold, post merge.\u201d<\/p><\/blockquote>\n DecenTrader drew comparisons to the hard forks of Bitcoin, which occurred in the second half of 2017 and later. Now, as then, the risk of distraction remains.<\/p>\n \u201cLong term, the Merge has fundamental changes which we are interpreting as being bullish for Ethereum, but the actual event will undoubtedly prove to be volatile as the market wrestles between narratives,\u201d the update concluded:<\/p>\n \u201cBe extremely wary of scams, fork tokens etc, we have already seen multiple around the Merge and ETHPoW forks.\u201d<\/p><\/blockquote>\n ETH\/USD trended down for a second straight day at the time of writing, eyeing $1,760 after hitting local highs of $1,790.<\/p>\n Bitcoin\u2019s network fundamentals have been anything but bearish lately, and this week, that trend continues to new heights.<\/p>\n Both Bitcoin\u2019s mining difficulty and hash rate have either hit or are due to hit new all-time highs in the coming 48 hours as of Sept. 12.<\/p>\n According<\/a> to estimates from monitoring resource BTC.com, difficulty will increase by 3% at the next automated readjustment, sending it further into unknown territory with a total of 31.91 trillion.<\/p>\n That follows the previous jumbo readjustment<\/a> of 9.26% two weeks ago, this forming the largest increase since 2021 as well as acting as a firm signal that miner competition is healthier than ever.<\/p>\n Indeed, since their latest \u201ccapitulation\u201d phase ended<\/a> last month, as per on-chain data, miners have been racing to add hashing power to their operations. This is exemplified by the hash rate \u2014 the estimated combined hashing power of the Bitcoin network \u2014 itself spiking to levels never seen before in recent days.<\/p>\n According<\/a> to MiningPoolStats, that spike came on Sept. 5 and involved a brief trip to 298 exahashes per second (EH\/s). The hash rate currently hovers at just under 250 EH\/s.<\/p>\n Analytics platform TheTIE, meanwhile, noted<\/a> that the increase in hash rate had moved the timing for the next Bitcoin block subsidy halving event forward<\/a>.<\/p>\n \u201cAs Bitcoin Hashrate rises up to all time highs, there’s an important second order effect to remember: The Halving. Before this, it was expected for 2024, but now the projected date for the next $BTC halving has been moved to Q4’23,\u201d it commented alongside a hash rate chart.<\/p>\n As bullish as the data and analysis seems to be, the overall crypto market still can\u2019t quite shake the sense of foreboding.<\/p>\n Related:\u00a0Crypto traders eye ATOM, APE, CHZ and QNT as Bitcoin flashes bottom signs<\/a><\/em><\/strong><\/p>\n The Crypto Fear & Greed Index<\/a>, after a brief escape higher, is back in \u201cextreme fear\u201d as of Sept. 12 in a sign that a definitive change of trend has yet to enter.<\/p>\n \u201cExtreme fear\u201d is where the Index has spent much of 2022, including its longest-ever consecutive stint<\/a> lasting over two months.<\/p>\n For Santiment, a platform dedicated to the analysis of crypto sentiment, there was reason to be cautious, thanks to the profit-taking activity on both Bitcoin and Ether.<\/p>\n \u201cBitcoin has climbed back above $22k today for the first time in over 3 weeks,\u201d it summarized<\/a>:<\/p>\n \u201c$BTC’s ratio of transactions in profit vs. loss is at its highest since March, and it appears that many have viewed this mild bounce as the trigger to trade again.\u201d<\/p><\/blockquote>\n The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.\n<\/p>\n<\/div>\nSolid weekly close boosts short-term BTC bets<\/h2>\n
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Inbound CPI combines with dollar nosedive<\/h2>\n
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The Merge is here<\/h2>\n
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Difficulty, hash rate tackle all-time highs<\/h2>\n
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Extreme fear proves sticky<\/h2>\n
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