Bitcoin – What to watch? Tech earnings take centre stage

After falling 1.8% last week, marking the second consecutive week of decline, Bitcoin has found a floor for now. The price has recovered from below $80,000 last week to around $82,000 at the time of writing, although it remains below levels recorded earlier in October. 

With the Federal Reserve now in its blackout period and a lighter week of U.S. macroeconomic data, this week's focus will be on corporate earnings as tech stocks attempt to recover from last week's sell-off. 

US tech earnings 

Around 15% of the S&P 500 is due to report Q3 earnings this week, including major names such as Meta, Lam Research, Texas Instruments, Tesla and Netflix. The results will help determine whether buyers return to the AI trade or continue last week’s recent sell-off. 

The tech sector fell sharply last week, with the Nasdaq 100 falling almost 5%, South Korea's KOSPI was down 19%, and the Philadelphia Semiconductor Index down 12%. This matters to Bitcoin, which trades in a positive correlation with the Nasdaq 100.  

The selloff in memory stocks and AI-related firms came amid growing questions over whether heavy investment in AI infrastructure will generate sufficient returns. These concerns return to the forefront ahead of Meta's earnings, given the company's huge investment in AI. 

A recovery in tech sentiment has helped Bitcoin rebound at the start of the new week. Strong earnings and guidance could support risk appetite and help Bitcoin extend its recovery. However, disappointing results could reignite concerns over AI valuations and weigh on risk assets, including Bitcoin. 

Jobless claims 

Given the quiet U.S. macroeconomic calendar, weekly jobless claims on October 22 will be one macro indicator to watch. While claims do not usually move markets on their own, they provide a timely indication of how the labour market is holding up, particularly following last month's weaker-than-expected non-farm payrolls report. 

US EIA Oil inventories 

US oil inventory data will be released on Wednesday and could be a catalyst. A larger-than-expected decline in oil inventories at a time when the oil market is concerned about supply due to the Middle East conflict could push energy prices higher, raising inflationary fears and the prospect of further Fed tightening. 

Ahead of next week's Federal Reserve rate decision, markets have reined in expectations for policy tightening. Markets are pricing in a 15% probability of a rate hike in October, while still seeing an 85% probability of a 25-basis-point hike before year-end. Weaker labour-market data could ease rate hike concerns. 

Institutional and US investor demand 

Bitcoin ETF demand has weakened across October. U.S. spot Bitcoin ETFs recorded a second consecutive week of net outflows last week, with $228.5 million withdrawn. Persistent outflows could limit Bitcoin's recovery, particularly if institutional buyers fail to return as prices stabilise. 

U.S. investor demand is also emerging as a headwind. The Coinbase Premium Index, which measures the price difference between Bitcoin on Coinbase and Binance, fell to its lowest level since June 30. A negative reading suggests weaker demand from U.S. investors, which could mean Bitcoin is less able to absorb selling pressure. 

BTC technical analysis 

BTC/USDT ran into resistance at $87,500 before falling back and finding support at the 50 EMA around $80,000. Holding above the 50 EMA level keeps outlook constructive. 

The recovery is now testing resistance around $82,000, although the RSI is neutral at 50, pointing to a consolidation period. Buyers will need stronger momentum to break above $85,000, which capped bullish attempts last week, ahead of $87,500, the September peak. A break above here would create a higher high and bring $90,000 into focus. 

On the downside, a break below the 50 EMA around $80,000 would weaken the recovery and expose the 200 EMA around $75,000.