Despite encouraging U.S. inflation data, Bitcoin struggled to break a significant resistance level last Thursday, continuing its downward trend observed since the start of June.

Last Thursday, Bitcoin, a digital currency, could have done better than people hoped. This happened despite some good news about the US economy. People thought this news might lead to a cut in interest rates, which usually makes higher-risk things like Bitcoin do well.

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• Despite encouraging U.S. inflation figures, Bitcoin faced resistance and could not break its ongoing downward trend from June.
• The MACD histogram, a standard tool for tracking market trends, indicates a potential positive shift in momentum, giving Bitcoin supporters hope.
• Reduced Bitcoin supply from Germany’s Saxony state and uncertainty over the distribution of Bitcoin to Mt. Gox’s creditors may impact future market trends.

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Is Bitcoin Rally Over?

For a while, it looked like Bitcoin might start doing better. This would have been a good sign and might have attracted more people to buy Bitcoin. But that didn’t happen. The price of Bitcoin fell below $57,000 the following day. This could mean that the price might not be stable for a while. Something similar happened on July 1, which made the price fall even more.

But it’s not all bad news. A tool called the MACD histogram suggests Bitcoin might start to do well again soon. Plus, a hefty supply of Bitcoin from Saxony in Germany is getting smaller, which caused the price to drop earlier this month. It needs to be clarified how much of the 95,000 Bitcoin that will be given to people who lost money because of a company called Mt. Gox will be sold.

A big repayment of $16.3 billion, a more positive view of digital money like Bitcoin, and the possible interest rate cut in September could give more confidence to people who want to hold onto Bitcoin for a while. FalconX, a company that deals with digital money, stated this in its latest newsletter.

FalconX also mentioned that any sale by the people who lost money because of Mt. Gox might differ from sales in Saxony. They said there might be more sales on exchanges than to professional buyers, or sales might be spread out over time.

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