As a seasoned analyst with over two decades of experience under my belt, I can confidently say that the US CPI release at 8:30 am ET is always an exciting event for any investor. The impact this data has on risk-on assets like Bitcoin, Ethereum, and stock markets is nothing short of dramatic.
As the U.S. Consumer Price Index (CPI) is due to reveal its September figures at 8:30 am ET, investors anticipate increased market turbulence. The inflation data from September in the United States could significantly influence the Federal Reserve’s forthcoming interest rate decision and potentially affect riskier assets such as Bitcoin, Ethereum, stock markets, etc.
In the last ten days, Bitcoin (BTC) has dropped by 5%, taking crypto investors by surprise as they anticipated a bullish trend in October. This unexpected price movement serves as a reminder that history doesn’t always follow a predictable pattern. Given this recent macroeconomic event, there might be a change in Bitcoin’s overall trend.
Let’s delve into the concept of US Consumer Price Index (CPI) or inflation, and explore how this key economic indicator affects risky investments. In simple terms, US CPI measures the average change in prices of goods and services purchased by households over a specific time period. This data point plays a significant role in determining the health of the economy, and influences how investors perceive risk-on assets like stocks and bonds.
What Can Bitcoin Expect From US CPI Today
It’s probable that Bitcoin may show temporary price fluctuations following the release of the U.S. Consumer Price Index (CPI) or inflation data. There’s a strong possibility of a quick spike in price, but the overall trend is expected to remain negative until Bitcoin successfully surpasses the resistance level at $65K.
What Is Inflation Data?
The US CPI or inflation data measures the average change in prices of a basket of goods and services consumed by an average American. The CPI data is released monthly by the Bureau of Labor Statistics (BLS) and serves as a key inflation gauge.
How Does US CPI Affect Bitcoin?
As an analyst, I find it crucial not only to focus on the raw inflation figures but also to consider whether they deviate from expectations. An unexpectedly high inflation rate can spark anxiety among investors, leading them to favor secure investments such as gold, precious metals, government bonds, and so forth. This trend is unfavorable for risk-on assets like stocks and cryptocurrencies, making the higher the inflation data, the more bearish it becomes for these assets.
On the other hand, lower inflation data promotes borrowing and increases liquidity in risk-on markets, leading to a rally.
For August, the reported inflation rate stood at 2.5%, while the general anticipation or prediction was 2.3%. Here are some potential scenarios based on the actual inflation figure:
- Inflation comes in hotter-than-expectations: Investors can expect Bitcoin price to crash.
- Inflation meets expectations: Bitcoin is likely going to continue its consolidation.
- Inflation is lower than expectations: This outlook will help boost risk-on assets like Bitcoin and potentially kickstart the October rally.
Bitcoin Price Analysis: BTC Takes a Breather After 6.40% Crash
Following the insights from my earlier readings, I experienced a 6.40% dip in Bitcoin’s value to around $60.3K after it tested the range of $63.9K to $65K. Moving ahead, I anticipate a brief recovery rally that might propel Bitcoin up to approximately $61.5K before resuming its descending trend.
The RSI has slipped below the 50 mean level due to the recent crash, but is yet to tag the oversold level. A bounce to 61.5K could see a retest of the mean level, which will reveal the next step for BTC. Rejection here could further strengthen the previous Bitcoin price forecast that hints at a breakdown of $60.3K followed by a retest of $57.2K to $57.9K.
Should the BTC price manage to transform the $61,800 resistance into a solid support base, it would imply a return of the bullish sentiment. This scenario could lead to another advance towards challenging the $64,000 barrier again. Overcoming the $65,000 resistance will signal the resumption of the bull market and may even push Bitcoin back toward the $70,000 psychological threshold.
Read More
- BTC PREDICTION. BTC cryptocurrency
- SOL PREDICTION. SOL cryptocurrency
- LUNC PREDICTION. LUNC cryptocurrency
- USD ZAR PREDICTION
- USD CLP PREDICTION
- CKB PREDICTION. CKB cryptocurrency
- VANRY PREDICTION. VANRY cryptocurrency
- SEILOR PREDICTION. SEILOR cryptocurrency
- NAKA PREDICTION. NAKA cryptocurrency
- ASTO PREDICTION. ASTO cryptocurrency
2024-10-10 13:52