Bitcoin eyes $28,000 pressure as traders call for CPI-day BTC price volatility
Bitcoin (BTC) tracked $27,500 on May 10 as markets braced for what was expected to be positive inflationary pressure in the US.
CPI set for months of decline
Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as it held in a narrow trading range ahead of April’s Consumer Price Index (CPI).
A classic volatility catalyst for risk assets, the CPI forms one of the key metrics the Federal Reserve considers when interest rate changes.
The next change is a full month away, but statistical and private sector estimates predict that falling inflation will persist and even accelerate in the coming months.
“A little bit of stagnation now, but over the next two to three months we’re likely to see a gradual decline, and actually quite a steep decline, in inflation,” financial commentator Tedtalksmacro said in part of his May 9 YouTube analysis .
Tedtalksmacro referenced both the Cleveland Fed inflation forecast and, separately, “Trueflation,” an unofficial leading indicator of inflation trends that also showed further significant declines ahead.
In a subsequent tweet on the day, Tedtalksmacro separately showed potential BTC price changes against various possible CPI figures, along with the probabilities according to JPMorgan Chase.
CPI game plan for #Bitcoin
Over 5.5% –> USD 25,000 (4% probability)
5.3% to 5.5%–> $26,500 (25% probability)
5.0% to 5.2% –> $28,500 (50% probability)
4.7% to 4.9% –> $29,000 (20% probability)
4.5% or lower –> $30,000+ (1% probability)
*Probabilities according to JPMorgan
— tedtalksmacro (@tedtalksmacro) 10 May 2023
According to the CME Group’s FedWatch Tool, market expectations that the Fed will halt its rate hikes to curb inflation in June were at 80% at the time of writing.
Binance traders sell up spot
When it comes to short-term BTC price action Lasting impact of the Binance “FUD” episode earlier in the week meant that Bitcoin bulls remained unable to regain levels near $30,000.
Related: Binance ‘FUD’ Meets CPI – 5 Things to Know in Bitcoin This Week
Analyzes status quo among traders, monitors resource bias described the market as “oversaturated with shorts”, with market makers still selling at small price increases.
“Binance spot is the market selling aggressor today,” part of the Twitter comment tired.
Overnight, fellow monitoring resource Material Indicators noted that bid liquidity increased just below the $26,000 mark on the Binance BTC/USD order book.
“Expect to see liquidity move around the order book between now and this morning’s financial reports,” part of the comments on an accompanying chart read.
“The question is, will some of what’s there now be cleared out and make room for volatility, or will local support and resistance be isolated with buy and sell walls?”
Blade: Unstable coins: Depegging, bank runs and other risks loom
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
