Bitcoin awaits critical US CPI data for jump over $120,000 or decline to $100,000
Bitcoin is bracing for the discharge of the September US Consumer Price Index (CPI) on Oct. 24, the primary main data level because the federal shutdown started.
Analysts at The Kobeissi Letter emphasized the significance of this replace, noting that will probably be the primary CPI launch on a Friday since January 2018 and comes simply 5 days earlier than the Federal Reserve’s Oct 29 assembly.
Moreover, with the Labor Department halting all different main data releases till the shutdown ends, this CPI report will stand alone because the Fed’s key inflation gauge.
That isolation raises the stakes as there will likely be no recent jobs, payroll, or producer-price data to steadiness the image.
Inflation forecast
The most up-to-date CPI report confirmed US inflation at 2.9% in August, a slight uptick from 2.7% the earlier month.
Considering this, Wells Fargo economists now expect September’s studying to rise modestly to 3.1%, nonetheless inside a spread according to gradual disinflation. Core costs, which exclude meals and power, are projected to stay regular, signaling that inflation pressures are easing however not gone.
Across monetary markets, merchants are already positioning for potential coverage easing. According to the CME FedWatch Tool, futures data present a 99% chance that the Fed will lower charges at its Oct. 29 assembly and an 85% probability of one other discount in December.
Notably, a softer CPI studying would seemingly reinforce that outlook and weaken the greenback, whereas a hotter-than-expected print might briefly revive rate-hike hypothesis.
Impact on Bitcoin
Kautious Data analysts said the CPI’s affect on crypto stays direct as the present “thinner macro indicators generally is a close to‑time period bullish setup for crypto narratives whereas including tail danger for broader markets.”
According to the agency, a softer core studying beneath 0.3% month-over-month would help a dovish outlook, pressuring the greenback and favoring property similar to gold, equities, and Bitcoin.
However, a stickier inflation outcome, significantly if providers and shelter rise above 0.4%, might strengthen the greenback and weigh on danger property.
The agency additionally flagged that crypto markets usually stage “pre-release rallies and post-print sell-the-news reactions” as volatility spikes and funding turns.
Meanwhile, Dean Chen, an analyst at digital-asset agency Bitunix, instructed CryptoSlate that the market response will hinge on how traders reprice danger after the discharge.
He said that the market might maintain the present “high-for-longer however steady” narrative if the data meet expectations, which might enable Bitcoin to proceed consolidating close to its latest highs.
However, a stronger core determine would possibly raise Treasury yields and the greenback, triggering a short-term correction from the higher vary.
Moreover, Chen added {that a} cooler CPI might renew ETF inflows and push Bitcoin towards the $117,000-$120,000 zone, whereas a warmer report would possibly drive capital again to safer property, testing help close to $100,000.
He added:
“Traders ought to watch real-time actions in US yields and the greenback following the discharge: a simultaneous rise in each would strain Bitcoin, whereas a retreat might reignite danger urge for food. In this setting, volatility stays elevated, and the sustainability of ETF inflows will decide whether or not Bitcoin can regain momentum post-data.”
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