Bitcoin rises to $32.3K, yet three factors might prevent it from regaining its lost ground

Since May 27, Bitcoin (BTC) price action has been surprisingly strong. Weekends, especially holiday weekends, are notorious for their volatility and unpredictability, with huge swings in price common. Even in bull markets, bearish price movement is not uncommon; however, BTC defied expectations.

BTC/USD daily chart (Coinbase) Source: TradingView

The price of bitcoin rallied nearly 11% between May 27 and May 30, reaching the crucial $28,600 barrier before returning above $30,000 to $31,700. The weekly close was the highest since early April, providing bulls with their best three-day stretch in more than two months. Macroeconomic concerns might limit any additional gains.

The worldwide food supply is a key yet often neglected element in Bitcoin’s long-term price potential. Because of the COV-19 pandemic, governments across the world have closed their seaports and airports, effectively shutting off and disrupting the flow of products. This interruption will take years to recover from, but it isn’t the most worrying aspect.

In the United States, fertilizer costs have risen substantially in recent months. The Fertilizer Price Index was $78.83 in January 2021 and is now at $254.97, up almost +225 percent over the last year and a half. This market is likely to continue being disrupted by supply chain disruptions and continuing shortages for some time.

Fertilizer price index Source: ycharts.com

Commodity prices continue to rise, and they are a leading cause of the continuous increase in inflation. Wheat (CBOT: ZW) hit new all-time highs in February 2022 and remains near them now. In just 2022, alone, wheat futures have risen by as much as 76%, and over 143% since December 2018.

Wheat futures (ZW) weekly chart (CBOT) Source: TradingView

Oil futures are trading at heights not seen since July 2008, as the cost of oil continues to rise. There’s a lot of anxiety about whether or Not, with traders and investors expressing uncertainty that prices may reach $150 per barrel once China completes its COVID shutdown. When it does, demand will most certainly return, pushing up oil even more.

Crude oil futures (NYMEX). Source: TradingView

Equity markets around the world are under tremendous stress, with mounting inflation, increasing commodity costs, supply chain disruptions, and the Ukraine conflict all weighing on risk-on investors and traders.

This week will see a number of major economic events, which are likely to halt any significant stock price movement. The European Union’s unemployment data is due on June 1, as well as the Bank of Japan’s interest rate decision and manufacturing statistics. On June 3, the National Bureau of Statistics in the United States will release employment numbers and non-farm payrolls data.

On top of that, three former members of the Federal Reserve’s Board of Governors are scheduled to talk on June 3: John Williams and James Bullard on June 1, Lael Brainard on June 3.

Bitcoin is coming off a new all-time high of nine weekly defeats. Buyers have returned since the start of the current weekly candlestick, pushing BTC above the entirety of the previous two weeks’ trading range and well above the flash crash’s 50 percent range on May 9, 2022. If Bitcoin price can close over $31,350 per day, it has a great chance to reach $37,000. The volume profile for 2022 is also thin, ranging from $32,000 to $37,000. However , if bulls face sellers again at $37,000.,

BTC/USD daily Ichimoku Kinko Hyo chart. Source: TradingView

If bulls want to communicate a new uptrend is about to begin, they’ll need to push Bitcoin price past $44,000 on a daily basis. In that case, BTC would set up an “ideal bullish Ichimoku breakout,” giving bulls the route they need to challenge the all-time high.

At the absolute worst, a short-term reversal is very probable. Traders should expect food commodities and oil to fall while stocks and Bitcoin rise if the old technical analysis saying, “volume leads price,” comes true again.

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