Saturday, April 1, 2023

CPI Data Turns Out Higher Than Expected, But Bitcoin Price Might Soon Hit $25K

Bitcoin Price

Recently, during the FOMC meeting, the Federal Reserve had a soft approach towards interest rate hike as there was only 0.25% interest rate hike instead of 0.50%. Today the traders and investors had hoped that there will be a decreased inflation rate in January.

This positive anticipation had resulted in a slight market recovery as the world’s first cryptocurrency, Bitcoin price had regained its lost $22,000 area. Hence, Bitcoin’s reverse price action influenced other cryptocurrencies as well. 

On the contrary, as per the reports, the CPI data for January has hit 6.4% whereas the expected data was 6.2%. Also the JP Morgan analyst had claimed that even if the crypto market rallies after positive CPI data the rally won’t last for a long time. If the market turns out to be as per JP Morgan analysis, it will most probably be another buy the news event.

Bitcoin Trend Reversal Ahead ?

Just before the Consumer Price Index (CPI) data for January month was yet to be released, the crypto market was slightly on an upward movement. Furthermore, due to the expected positive inflation data, even the US Dollar Index (DXY) along with S&P 500 and Nasdaq are trading positive.

Now, the higher than expected CPI data has resulted in Bitcoin fluttering between $21,900 and $22,000 area. However, as per the data Bitcoin is now making an effort to form a bear trap pattern. A bear trap pattern is nothing but a downward movement with an overall bullish move. If this turns out to be true then Bitcoin might soon move towards the $25,000 mark.

Overall, the inflation data is still positive which could result in Bitcoin’s reverse action. If Bitcoin has to move towards its positive trend, then the Bitcoin price has to cross its first major resistance of $22,500 and then $23,000 level. At the time of writing, Bitcoin is selling at $21,994 after a surge of 2.16% in the last 24hrs.

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Elena R

Elena is an expert in technical analysis and risk management in cryptocurrency market. She has 10+year experience in writing – accordingly she is avid journalists with a passion towards researching new insights coming into crypto erena.

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The latest Consumer Price Index (CPI) data released by the US Bureau of Labor Statistics (BLS) has turned out higher than expected in October. The data showed that prices rose by 0.3% during the month, more than the 0.2% estimated by analysts. While the data provides a boost to the recovery of the US economy, it reignites fears of aggressive inflation that could jeopardize the current bull run of the stock markets.

However, this hasn’t stopped Bitcoin price speculators from betting on the world’s largest cryptocurrency to potentially hit $25K sometime next year. Although Bitcoin was down by 4.6% today, its long-term outlook appears to be strong, especially in light of the number of institutional investors that have been investing in the asset recently. The looming inflationary effects of the global economy post-Covid19 could also prove to be a tailwind for Bitcoin price, as it remains one of the few digital assets capable of providing a hedge against traditional monetary policies.

Furthermore, with Grayscale Investments holding more than 16% of all Bitcoin supply and PayPal recently announcing its entry into the cryptocurrency space, interest in Bitcoin could just be the beginning of a long bullish run. The increasing scarcity of Bitcoin and the recent announcement of Tesla investing $1.5 billion in Bitcoin, could also push its price further in the coming months.

Overall, while the CPIs data presents some interesting possibilities for investors and users, the future of Bitcoin remains uncertain. However, due to the driving forces discussed above and its proven ability to outpace traditional markets, it appears that Bitcoin might soon hit the $25K mark.

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