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Bitcoin Technical Analysis for Swing Traders: Key Support Levels Under Stagflation Risks

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Bitcoin (BTCUSD) Technical and Macro Analysis: Bearish Momentum Amid Stagflation Risks

The cryptocurrency market remains under pressure, and Bitcoin (BTCUSD) is showing early signs of weakness on both the daily and weekly charts. While the long-term structure still respects an upward channel, the latest technical signals suggest that bearish momentum could dominate in the short to medium term.

At the same time, the macro backdrop is complicated by stagflationary risks in the United States—sticky inflation that remains above the Federal Reserve’s target, resilient retail sales that reflect consumer demand, and a weakening labor market. These dynamics add further uncertainty to Bitcoin’s trajectory, as monetary policy could stay tight for longer while growth slows.

Technical Outlook: Daily Chart

On the daily chart, BTCUSD is currently trading around $115,600, sliding from recent highs near the $120,000 level. The pair remains inside a rising channel but is showing signs of weakness after failing to retest the upper band.

Indicators:

  • Stochastic RSI: currently hovering in the overbought zone and turning lower, signaling potential downside pressure.

  • MACD: the histogram is flattening, and momentum looks weaker compared to earlier rallies.

Support and Resistance (Daily):

  • S1: $113,500 – immediate support at the midline of the channel.

  • S2: $110,000 – strong psychological and technical support, where buyers previously defended the trend.

  • S3: $105,000 – deeper correction level, near the lower channel boundary.

  • R1: $117,500 – minor resistance just above the current price.

  • R2: $120,000 – key psychological barrier; a breakout above here would shift momentum.

  • R3: $124,500 – upper channel resistance, last touched in late August.

For now, as long as BTCUSD remains below R2 ($120,000), the short-term bias leans bearish toward S2 ($110,000).

Technical Outlook: Weekly Chart

The weekly chart provides a broader perspective. Bitcoin is still inside a long-term rising channel (highlighted in green), but recent candles show rejection at the upper boundary and weakness in momentum.

Indicators:

  • Stochastic RSI: trending downward near the oversold region (around 28). This suggests weakening momentum, though it may later provide a relief bounce.

  • MACD: bearish crossover confirmed, with the blue line below the signal line and histogram printing red. This is a strong medium-term bearish signal.

Support and Resistance (Weekly):

  • S1: $110,000 – key mid-channel support.

  • S2: $98,000 – lower boundary of the long-term rising channel.

  • S3: $81,000 – major structural support, a potential long-term floor if broader risk assets sell off.

  • R1: $120,000 – recent top, strong rejection level.

  • R2: $132,000 – upper channel resistance.

  • R3: $150,000 – major breakout target if bullish momentum returns.

From a weekly perspective, the downside risk dominates as long as BTCUSD trades below R1 ($120,000). A test of S2 ($98,000) remains possible if macroeconomic conditions worsen.

Macro Backdrop: Stagflation Concerns

The technical bearish signals align with a fragile macroeconomic environment. Recent U.S. data suggests a stagflationary mix that complicates both risk sentiment and monetary policy expectations.

  1. Inflation Remains Sticky

    • Latest CPI reports show inflation still above the Federal Reserve’s 2% target.

    • This sticky inflation means the Fed cannot fully pivot to rate cuts, even though financial markets are hoping for looser policy.

  2. Retail Sales Resilient

    • U.S. retail sales remain strong, suggesting consumer demand is still holding up.

    • This adds further inflationary pressure, keeping the Fed in a hawkish stance.

  3. Labor Market Weakening

    • Nonfarm payrolls (NFP) and ADP reports point to a cooling jobs market.

    • Rising unemployment and softer job creation highlight the risk of slowing growth.

This combination—high inflation, strong consumption, but weaker jobs—fits the textbook definition of stagflation.

Linking Macro to Bitcoin

Bitcoin, often marketed as a hedge against inflation, does not always behave as a safe haven in stagflationary conditions. Instead, it tends to trade more like a risk asset, reacting to liquidity conditions and investor sentiment:

  • Hawkish Fed (tight monetary policy, higher rates) → bearish for BTC, as liquidity drains and yields on safe assets (bonds) become more attractive.

  • Dovish Fed (easing, rate cuts) → bullish for BTC, as investors search for higher-yielding or alternative assets.

At present, the Fed is signaling caution. While rate cuts might be considered in the future due to labor market weakness, sticky inflation and strong retail sales limit the central bank’s dovish pivot. This means the macro outlook aligns more with a hawkish-to-neutral stance, keeping pressure on Bitcoin.

Conclusion

Both technical and macro signals point toward caution for BTCUSD:

  • Daily chart: momentum fading, risk of correction toward $110,000 (S2).

  • Weekly chart: bearish MACD crossover, potential test of $98,000 (S2) if support fails.

  • Macro backdrop: stagflationary risks limit the Fed’s ability to turn dovish, maintaining downward pressure on risk assets like Bitcoin.

Unless Bitcoin reclaims and sustains above $120,000 (R2), the broader bias remains bearish. Traders should watch the upcoming inflation and labor market reports closely, as any shift in Fed policy expectations will directly impact BTC’s next major move.



Disclaimer:
This article is intended for informational and educational purposes only and should not be taken as financial advice. Trading and investing in cryptocurrencies involve significant risks, including the potential loss of capital. The technical analysis and market insights presented here are based on publicly available data and chart indicators, and no outcomes are guaranteed. Readers are encouraged to conduct their own research or consult a licensed financial advisor before making investment decisions.

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