Crypto Traders: Brace Yourselves, the Inflation Ghost is Here!

by

In the dusty plains of the financial frontier, crypto traders stand like weary cowboys, eyes squinted against the harsh glare of uncertainty. The U.S. is about to unleash its December Personal Consumption Expenditures (PCE) data, a beast the Federal Reserve whispers to in the dead of night. And boy, are the traders jittery-like a jackrabbit in a rattlesnake convention.

  • The soothsayers of Wall Street, with their crystal balls and fancy charts, predict both headline and core PCE will rise 0.37% in December (4.5% annualized). That’ll push core PCE to 3.0% year-over-year-the highest since February 2025-and headline to 2.9%, a peak not seen since March 2024. Numbers, numbers, numbers-enough to make a man’s head spin like a windmill in a tornado.
  • Bitcoin, that stubborn mule of the crypto world, is trading around $67,852, up 1.27% on the day. Its RSI is at 36.86, recovering from being kicked in the dirt but still moving slower than a tortoise in molasses. Traders are sitting on their hands, waiting for the macro gods to give them a sign.
  • The BTC/ETH ratio stands at 34.5806, a testament to Bitcoin’s dominance. Investors are hunkering down like prairie dogs, defensive as all get-out ahead of the inflation print.

According to Nick Timiraos, the Wall Street Journal’s resident sage, forecasters expect both headline and core PCE to rise 0.37% month-over-month in December. That’s a 4.5% annualized pace, mind you. Core PCE would hit 3.0% year-over-year, the highest since February 2025, while headline PCE is pegged at 2.9%, a high not seen since March 2024. It’s enough to make a man wonder if the economy’s got a fever, and the only prescription is more inflation.

Forecasters expect PCE inflation (core and headline) was 0.37% in December (4.5% annualized rate).

This would push up the core PCE index to 3.0% over 12 months, the highest since February 2025

Headline PCE is estimated at 2.9%, the highest since March 2024

– Nick Timiraos (@NickTimiraos) February 20, 2026

The median forecast lines up like ducks in a row: 0.37% month-over-month for both headline and core readings, compared to November’s softer 0.21% headline and 0.16% core increase. It’s all very tidy, like a farmer’s ledger after a good harvest.

For the crypto markets, the writing’s on the wall-or maybe it’s just the dust. A hotter-than-expected print could mean higher-for-longer rates, pushing Treasury yields and the U.S. dollar higher. That’s bad news for risk assets like Bitcoin and its altcoin cousins, who’d rather be left alone in their digital pastures.

But a cooler print? Well, that could revive rate-cut bets and send the markets into a relief rally, like a sudden rain after a long drought.

Bitcoin’s Technical Setup: A Tale of Consolidation and Hope

Bitcoin’s trading at $67,852, up 1.27% on the day, according to the daily BTC/USDT chart on Binance. Its price action is as steady as a rock in a river, consolidating after a sharp drop in early February that sent it tumbling toward the low-$60,000s. It rebounded like a rubber ball, but now it’s just sitting there, staring at the $70,000 mark like it’s a mirage on the horizon.

The daily RSI is at 36.86, with its moving average at 33.81. Momentum’s weak, but at least it’s not in the gutter anymore. The balance of power indicator is negative at -3,298, showing sellers still have the upper hand, though they’re not exactly flexing their muscles.

For traders, it’s a waiting game. A hot inflation surprise could send BTC back to the mid-$60,000 support zone, while a softer reading might open the door for a renewed test of $70,000 resistance. It’s like watching a cowboy decide whether to ride the bull or just sit this one out.

Watch the Bitcoin-Ethereum Ratio: A Tale of Two Cryptos

The BTC/ETH daily chart shows Bitcoin trading at 34.5806 ETH, up 0.69% on the session. The pair surged from below 30 in late January to above 34 in early February, proving Bitcoin’s the tougher cowboy in a market pullback. Now it’s consolidating around the 34-35 region, like a herd of cattle taking a breather.

If inflation comes in hot and macro risk aversion rises, Bitcoin dominance could extend further. But a cooler print might encourage a rotation back into Ethereum and altcoins. It’s a game of musical chairs, and everyone’s waiting for the music to stop.

Macro Reaction is Key: The Real Show’s in the Stands

Beyond the headline number, traders should keep an eye on the U.S. 10-year Treasury yield and the dollar index. Crypto’s been as sensitive as a skittish horse to shifts in rate expectations, especially as inflation data tests the narrative that price pressures are easing. With core PCE potentially hitting 3.0% year-over-year, today’s print could shape the Fed’s next move and set the tone for digital assets into March.

For now, Bitcoin’s coiled below resistance, like a spring waiting to be released. The PCE release may decide whether it breaks higher or rolls over like a tired dog. Either way, it’s going to be a wild ride-so grab your hat and hold on tight.

Read More

2026-02-20 12:12