Bitcoin extended its recent surge on Monday, trading above $78,600 after a weekly gain of around 20% that marked its strongest performance in more than two years. The cryptocurrency touched an intraday high near $79,460 before consolidating above $77,000, leaving traders focused on the psychological $80,000 level and a possible longer-term move toward $90,000.
Technical analysts note that a bull flag pattern may be forming on short-term charts after the local high of $79,500 and a pullback to $76,700. The structure remains unconfirmed, as it still lacks the typical three touches on both the upper and lower boundaries. The retracement has so far held at the 0.236 Fibonacci level, the shallowest of the standard retracements, although a deeper move toward the 0.382 level or a confluence zone near $69,000 could represent a healthier correction. That zone includes horizontal support, the 0.618 Fibonacci level and potential confirmation of the 200-day simple moving average.
Broader macro conditions are supporting Bitcoin’s bid. US Treasury Secretary Scott Bessent announced increased purchases of longer-dated government debt, helping lower long-term bond yields and improving risk appetite. The US government debt surpassing $40 trillion has also revived the currency debasement trade, favoring scarce assets such as Bitcoin and gold. President Donald Trump renewed calls for clearer digital asset rules, while spot Bitcoin exchange-traded funds recorded $1.92 billion in net inflows last week, the strongest weekly total since early October. Short covering added further upward pressure.
Looking ahead, the Core Personal Consumption Expenditures inflation data on Wednesday is a key macro test, with economists expecting the annual rate to remain at 3.3%. Markets price a 65% probability that the Federal Reserve will keep rates unchanged in September. Federal Reserve Chair Kevin Warsh’s speech at Jackson Hole on Friday could also move Treasury yields and the dollar. A softer inflation print or cautious Fed tone could help Bitcoin challenge $80,000 and the previous high near $82,800, opening a path toward $90,000. Key support levels sit near $73,400, $71,600 and $70,000, with a more significant correction possible toward $67,000 if bullish structure weakens.
Momentum indicators remain stretched, with the Relative Strength Index in overbought territory on multiple timeframes. While the bullish structure remains intact as long as Bitcoin holds above $71,600, overbought conditions leave the rally vulnerable to profit-taking or a consolidation phase.
