The cryptocurrency market is bracing for a pivotal week, with traders shifting their focus from recent geopolitical tensions to critical macroeconomic events in the United States. While the relative calm in the oil markets provided some stability, the upcoming semi-annual monetary policy testimony by Federal Reserve Chairman Jerome Powell and the release of the core Personal Consumption Expenditures (PCE) price index are set to inject significant volatility. Bitcoin (BTC) has demonstrated remarkable resilience, holding its ground above the psychological $100,000 mark. However, its next directional move will likely be dictated by the signals emerging from these key economic indicators. As of the latest 24-hour data, BTCUSDT is trading at approximately $105,534, marking a 1.77% decline and testing crucial support levels.

Powell's Testimony: Setting the Tone for Risk Assets

The main event that traders are keenly anticipating is Jerome Powell's testimony before Congress. The Fed Chair is expected to face intense questioning, particularly from Republican members, regarding the central bank's decision to hold interest rates steady. Powell is likely to maintain his stance on the Fed's independence and its data-dependent approach to future policy decisions. However, the market will be dissecting his every word for hints of a potential dovish pivot. These expectations have been fueled by recent comments from Fed Governor Christopher Waller, who suggested a rate cut could be on the table as early as July. According to Chris Weston, head of research at Pepperstone, there are compelling reasons for the Fed to consider a more accommodative stance, citing well-anchored inflation expectations and emerging weakness in the labor and housing markets. A dovish tone from Powell could reignite risk appetite across financial markets, providing a significant tailwind for assets like Bitcoin and the broader crypto ecosystem. The market's reaction will hinge on whether Powell signals a willingness to cut rates in September, a path that U.S. swaps markets are already pricing in.

Inflation Data and Tariff Deadlines Create Uncertainty

Following Powell's testimony, the spotlight will turn to Friday's release of the core PCE price index, the Fed's preferred measure of inflation. The market consensus, as noted by Pepperstone, is for a mild 0.1% month-on-month increase, which would translate to an annualized rate of 2.6%. Such a benign reading would reinforce the case for imminent rate cuts and could trigger a bullish response in risk assets. However, the outlook is not without its complexities. Analysts at ING have cautioned that any dovish sentiment could be short-lived, highlighting the looming impact of potential tariffs. The 90-day pause on reciprocal tariffs is set to expire on July 9, and their implementation could introduce fresh inflationary pressures. This scenario could force the Fed to delay any rate cuts until later in the year, with ING suggesting the possibility of a single 50 basis-point cut in December if the jobs market deteriorates significantly. This uncertainty creates a challenging environment for traders, who must balance the hope of a dovish Fed with the risk of resurgent inflation.

Bitcoin Price Analysis and Key Trading Levels

From a technical standpoint, Bitcoin's price action is at a critical juncture. The BTCUSDT pair has seen a 24-hour trading range between $105,329 and $107,437. The lower end of this range, around the $105,000 level, is emerging as a crucial immediate support. A sustained break below this level could open the door for a deeper correction. On the upside, the recent high near $107,500 acts as the primary resistance. A decisive move above this barrier would be needed to confirm bullish continuation. Meanwhile, the altcoin market is showing signs of weakness. Ethereum (ETH) has been hit harder, with the ETHUSDT pair down over 4% to around $2,396. The ETHBTC ratio has also declined by nearly 1.9% to 0.02275, indicating Bitcoin's relative strength in the current environment. Other major altcoins like Solana (SOL) are also experiencing significant pullbacks, with SOLUSDT dropping 5.4% to $146.56. However, there are pockets of strength, such as Avalanche (AVAX), with the AVAXBTC pair rallying an impressive 6.7%, suggesting that capital may be rotating into specific narratives even amid broader market caution. Traders should closely monitor these key levels and inter-market dynamics as the week's macro events unfold.