Bitcoin Sees 10% Gain Following Mixed Consumer Inflation Data

Bitcoin and most altcoins have continued their recent recovery following the release of mixed consumer inflation data in the United States. As a result, Bitcoin rose to $99,000 for the first time since January 7, gaining 10% from its monthly low.

Market Reaction and Impact on Other Asset Classes

The rebound triggered more gains across altcoins, with notable increases in Virtuals Protocol (30.82%), ai16z (25.33%), and Algorand (18.48%). This rally also extended to other asset classes, with futures tied to the Dow Jones Industrial Average rising by 700 points and those linked to the S&P 500 index gaining nearly 100 points. Bond yields fell, with the 10-year, 30-year, and 5-year yields dropping to 4.66%, 4.90%, and 4.48%, respectively.

US Consumer Price Index Report Breakdown

A report from the U.S. Bureau of Labor Statistics showed that the core Consumer Price Index dropped from 0.3% in November to 0.2% in December, translating to an annual decrease from 3.3% to 3.2%. However, the headline CPI rose from 0.3% to 0.4% in December, resulting in an annual increase of 2.9%.

US CPI inflation is out with the number that matters most in my opinion — the monthly core measure — being softer than expected.

Market Expectations and Risks

The decline in core CPI has fueled market expectations that the Federal Reserve may deliver more than two rate cuts this year. However, risks remain, as inflation is still above the Fed’s 2.0% target, and there are indications that it may stay elevated for longer. Some of Donald Trump’s policies, such as mass deportations and tariffs, could lead to higher inflation pressures this year.

Bitcoin Price Analysis

The daily chart shows that Bitcoin has been in a steady rebound over the past few days, breaking above the 23.6% Fibonacci Retracement level at $94,210 and surpassing the 100-day Exponential Moving Average. Key support levels include $91,535, which it has held since November.

Tips for Investors

  • Monitor the market’s reaction to Donald Trump’s inauguration next week, as it may impact Bitcoin’s price.
  • Keep an eye on the 100-day Exponential Moving Average and the 23.6% Fibonacci Retracement level for potential support.
  • Be aware of the risks associated with inflation and its potential impact on the market.

Stay up-to-date with the latest cryptocurrency news and analysis on Global Crypto News.

Post Views: 0