Elena R
The Bitcoin market has been struggling to break through the $31,000 mark in recent weeks. The excitement around Bitcoin exchange-traded funds (ETFs) has also waned, even with multiple fund managers reapplying for their filings. Consequently, the market is now eagerly anticipating today’s release of the Consumer Price Index (CPI) by the United States Bureau of Labor Statistics, as it is expected to impact both the cryptocurrency and Bitcoin’s bullish outlook.
But what can you, the investor, expect? Let’s explore.
CPI Data Looms Large
Renowned Dutch crypto influencer and analyst Michael van de Poppe believes that the CPI data will have a significant impact on the Bitcoin market. He says that any change in the price of goods and services bought by consumers will inevitably affect the value of the US dollar, which will then impact Bitcoin and other crypto assets.
Related: Crypto Market Outlook: Brace for Market Volatility Ahead Of CPI Report Today
How Will the CPI Data Impact Bitcoin?
The projected month-to-month CPI data is expected to increase by 0.3 percent, surpassing the previous 0.1 percent. However, the year-on-year (y/y) CPI is predicted to drop from 4.0 percent to 3.1 percent. Similarly, the Core CPI month-on-month (m/m) is anticipated to decrease from 0.4 percent to 0.3 percent.
Poppe presents two possible scenarios for Bitcoin’s short-term price action based on the CPI data.
i) If the data favors the US dollar, he foresees a potential decline for Bitcoin, with prices possibly dropping as low as $28,500 in the coming days
ii) Conversely, a surge above the $31,000 threshold could materialize if the CPI data indicates an increase in inflation.
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As the market eagerly awaits the CPI data release, investors and traders will closely monitor its impact on Bitcoin and the wider cryptocurrency market. A positive outcome may provide the much-needed catalyst to reignite Bitcoin’s bullish sentiment before altcoins take center stage.
