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Inflation Data Triggers Bitcoin Dump, Bullish or Bearish for October?
- U.S. inflation rose more than expected in September with the CPI climbing 2.4% YoY.
- The inflation data has reduced expectations of further rate cuts from the U.S. Federal Reserve.
- Cryptocurrency markets reacted negatively to the news, with Bitcoin (BTC) falling nearly 4%.
- With Bitcoin unable to stay above the $60,000 mark, bullish momentum is waning, and there is increased selling pressure at higher price levels.
- Analysts highlight that for bullish sentiment to return and for new highs to be considered likely, Bitcoin needs to surpass and establish the 200-day moving average as a strong support level.
- Further rate cuts by the United States Federal Reserve or an increase in global liquidity could provide a tipping point for crypto markets.
- Global liquidity refers to the amount of money circulating within the global economy, often measured by the M2 money supply.
- The influx of stablecoins, alongside a spike in whale transactions and on-chain Bitcoin activity, suggests potential for a Bitcoin price rally in the coming weeks.
- Veteran traders and analysts are also bullish, with predictions of Bitcoin reaching $90,000 before Christmas and $135,000 by August/September 2025.
- However, the increased regulatory pressure and uncertainty around possible rate cuts have led to cautious sentiment and a downward pull on prices.
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