Bitcoin, Ether on Track for Strongest Weekly Gains Since March

Thirty days ago, bitcoin was nearing its first losing month of 2023, but today the asset is hurtling toward its strongest performance since March. Ether is following suit, and still has yet to post a losing month for the year.

Bitcoin and Ether are aligning on direction and momentum.

The CoinDesk Indices Bitcoin Trend Indicator (BTI) now signals that bitcoin has entered a significant uptrend phase, following its 15% increase this week.

Bullish catalysts over the past two weeks have started to thaw the frigid crypto winter. The catalysts include bitcoin and ether’s omission from a list of digital assets mentioned in U.S. Securities and Exchange (SEC) lawsuits against crypto exchange giants Binance and Coinbase, and more recently the spot bitcoin ETF filings by BlackRock, Invesco and WisdomTree. Rising jobless claims, a sign that the U.S. central bank’s hawkish monetary policy is slowing the economy, have also been encouraging.

The Ether Trend Indicator (ETI) is now also flashing an uptrend signal, a step above its prior neutral reading.

Momentum for both assets rose sharply this week with their respective Relative Strength Index (RSI) readings jumping 43% and 46%, respectively since Monday.

Not surprisingly the currency sector led Coindesk Market Index (CMI) sectors.

The CoinDesk Market Index rose 11% this week. As of publishing, the trailing five were BTRST (-13.4%), QNT (-5.9%), BTT (-5.0%), MXC (-1.3%), and LUNC (-0.4%)

Among the five CoinDesk Market Index (CMI) sectors, the currencies sector outperformed, as all 20 assets in the sector were positive.

Bitcoin Cash (BCH) and Onyxcoin (XCN), led the way, up 33% and 28% respectively. MINA and XLM were sector laggards, yet still up 8.8% and 9.3% respectively.

The DeFi sector trailed, while still rising 5.8%. Rocketpool (RPL), the third largest asset in the index, weighed on performance, falling 2.6% on the week.

What’s ahead in the upcoming week?

Can crypto prices maintain their momentum? Bitcoin has breached the upper range of its Bollinger Bands on four consecutive days, while its RSI level of 75 indicates that the asset is in overbought territory.

Traders leery of the current rally may view this as an opportunity to take profits. The extent to which BTC is or is not moved on to centralized exchanges will be worth monitoring.

Historically, BTC has tended to move higher, even when accompanied by large RSI figures. Trading volume peaked on Wednesday, and fell the two days following. The trajectory of momentum will be worth monitoring, for clues as to whether recent buying pressure is waning.

Macroeconomic data will be light, with the notable exception of Friday’s Personal Consumption Expenditure (PCE) report.

While the Consumer Price Index (CPI), gets most of the attention specific to inflation, a quick read through of Federal Reserve Minutes shows that PCE is frequently referenced by Federal Reserve Officials.

The consensus forecast is that PCE increased 0.4% in May. A figure above that could stall recent price increases. A figure below will likely have the opposite effect.