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Recently there have been significant fluctuations in the prices of <a target="_blank" href="https://www.coingecko.com/en/coins/bitcoin” rel=”nofollow”>bitcoin; Currently, they range between $87,000 and $87,500. This may not be a pleasure for investors who are currently on the sidelines waiting for the coin to reach $90,000, particularly the release of CPI data set today, 13 November. Analysts perceive this news to have considerable influence on market sentiment and the expected direction of the alpha crypto asset.
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The inflation barometer
Reflecting changes in the prices that consumers pay for goods and services, the CPI report It is a leading indicator of inflation. CPI expectations may cause more volatility in bitcoin markets as inflation rates affect the Federal Reserve's decisions on monetary policy.
Recent trends imply that if inflation remains low, the Federal Reserve could cut interest rates; historically this has had a positive effect on bitcoin prices. Reduced borrowing rates sometimes inspire investments in risky assets like cryptocurrencies, increasing demand for bitcoin.
<blockquote class="twitter-tweet”>
<a target="_blank" href="https://twitter.com/hashtag/bitcoin?src=hash&ref_src=twsrc%5Etfw” rel=”nofollow”>#bitcoin It's up to $90,000 and I think we're about to hit the markets.
The sweet spot is to have a 10% correction towards the CME gap before continuing.
I am a bit bearish ahead of tomorrow's CPI. pic.twitter.com/dfpUc2df1k
—Michaël van de Poppe (@CryptoMichNL) <a target="_blank" href="https://twitter.com/CryptoMichNL/status/1856256610466705567?ref_src=twsrc%5Etfw” rel=”nofollow”>November 12, 2024
Growing investor confidence
Famous crypto expert Michaël van de Poppe, founder of MNConsultancy, stated that the current situation in the crypto market corresponds well with the positive evaluation of bitcoin. in case CPI statistics would indicate more cases of inflation declines, he says this would lead to growing investor confidence and greater capital inflows into bitcoin and other cryptocurrencies.
Will bitcoin retreat?
However, it also warns that unforeseen increases in inflation could surprise markets and trigger price adjustments everywhere. He anticipates a 10% pullback for bitcoin ahead of the release of CPI data, targeting a range of $75,660 to $81,193.
Market reactions and predictions
As traders prepare for the CPI numbers, overall market sentiment remains mixed. Some experts think that the positive CPI numbers could cause a rise in bitcoin prices, but others say that people should not get too excited.
Meanwhile, many investors remain optimistic about bitcoin's long-term prospects. The incoming administration of newly elected US President Donald Trump adds another layer of complexity to market dynamics.
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According to Van de Poppe, short-term regulatory actions will benefit bitcoin, but their long-term consequences could be somewhat more complex if inflation control is not well managed.
Meanwhile, as bitcoin continues its path toward a major price discovery, attention will turn to the CPI data and the impact it has on digital assets. Investors should approach such an unpredictable environment with caution while staying focused on economic developments that could influence their investments.
At the time of writing, bitcoin was <a target="_blank" href="https://www.coingecko.com/en/coins/bitcoin” target=”_blank” rel=”nofollow”>trading at $87,509an increase of 2.1% and 17.2% in the daily and weekly periods, Coingecko data shows.
Featured image of The VR Soldier, TradingView chart
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