Bitcoin (BTC) Short Covering Soon As US CPI Numbers Could Surprise, Predicts Analyst

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As an experienced analyst, I have closely monitored the Bitcoin market for years, and based on the recent developments and on-chain data, I believe that hedge funds might be shorting Bitcoin in anticipation of unfavorable CPI numbers. This could potentially lead to a significant short covering event, resulting in a rapid surge in Bitcoin prices. However, it is essential to remain cautious as market sentiment hinges on the upcoming US CPI report.

Bitcoin, the most prominent cryptocurrency globally, experienced a setback on May 14, dipping by 1% and falling below the $62,000 mark. This decline was driven by apprehensions over unfavorable US economic data releases. According to CoinGlass statistics, approximately $100 million worth of Bitcoin long positions were liquidated within the previous 24 hours.

Bitcoin Short Covering Soon?

HODL15Capital recently shared some valuable information about the latest Bitcoin transaction patterns, revealing possible market indicators. According to their analysis, Bitcoin holders with less than 1 BTC have persistently sold off their coins, reflecting a consistent trend. However, an intriguing shift occurred among those holding 100 BTC or more, as they displayed net negative activity – a seldom-seen occurrence in the current market scenario.

HODL15Capital proposes a possibility: hedge funds could be betting against Bitcoin based on the upcoming Consumer Price Index (CPI) data. If these funds are right and the CPI figures turn out unfavorable, they may cover their short positions, triggering a notable increase in Bitcoin’s value.

Should hedge funds decide to bet against Bitcoin due to expected unfavorable Consumer Price Index (CPI) data released tomorrow, the subsequent buying to cover their shorts could lead to a significant price rebound.

— HODL15Capital (@HODL15Capital) May 15, 2024

As a researcher, I’m keeping a close watch on today’s anticipated US Consumer Price Index (CPI) release, which is scheduled for this afternoon on a Wednesday. According to Kyle Rodda, a seasoned market analyst at Capital.com, the focus of the financial world is currently centered around this significant economic data point.

The anticipation in the financial market revolves around tonight’s US Consumer Price Index (CPI) release. If this report were to materialize and signify a more than three-year low for the core CPI, it would be an encouraging development. However, for concerns about persistent and entrenched inflation to be allayed, a larger-than-expected decrease would be necessary.

According to well-known Bitcoin analyst Will Woo, we can expect a resumption of global liquidity by the end of this year.

Bitcoin specialist Willy Woo has detected a bullish trend in global liquidity based on his analysis, comparing it to an ascending triangle formation. He anticipates a significant breakout from this pattern preceding October 2024, which may indicate a potential surge in value for Bitcoin. According to Woo’s assessment, the time frame leading up to 2025 could mark a historically significant period for the cryptocurrency.

Global liquidity forming a bullish ascending triangle.

Expected breakout before Oct 2024.#Bitcoin 2025 will be one for the record books.

— Willy Woo (@woonomic) May 15, 2024

BTC Network And Whale Activity

At the moment this update was published, Bitcoin’s price stood at $61,915, while its total market value reached an impressive $1.2 trillion. Yet, it’s important to note that the Bitcoin network and significant investors (whales) have displayed some troubling indicators.

Based on data from Santiment, there’s been a significant drop in Bitcoin’s network activity. Simultaneously, Bitcoin’s big spenders or “whales” have exhibited less frequent large transactions.

The Bitcoin network has seen a decrease in activity recently. Notably, the number of significant Bitcoin transactions conducted by “whales” has also dropped off according to statistics provided by SantimentFeed.

— Ali (@ali_charts) May 14, 2024

According to Santiment’s analysis, negative sentiments surrounding issues like platform outages and withdrawal freezes on Coinbase are intensifying the current fear, uncertainty, and doubt (FUD) in the crypto market. The FUD could potentially build up to a point where it triggers a market reversal or rebound in the near term, as suggested by Santiment’s findings.

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2024-05-15 07:32