Bitcoin: The US inflation data, which will be released on Friday evening, are expected to send fluctuations between the markets. Also, investors expect this to push Bitcoin (BTC) out of the tight trading range. Here are the details…
How will Bitcoin react to inflation data?
Bitcoin (BTC) is trading around $30,000, a level where it has been fluctuating for more than a month. While attempts to break above $32,000 have been met with resistance, traders are also wary of allowing the coin to drop below $28,000. However, the US consumer price index (CPI) data for May may change this trend. Most of BTC’s losses in 2022 are due to fears of rising inflation, which is likely to spur interest rate hikes by the US Federal Reserve.
MarketWatch data shows markets are expecting 8.1 percent, down slightly from 8.3 percent in April. The general consensus in the market points to two main scenarios for BTC. If the data comes in below what investors expected, it will trigger a relief rally for the token amid signs that inflation is indeed starting to calm down. Experts say that BTC will likely climb above the $32,000 top in the short term.
But according to experts, if the data comes in higher than expected, BTC will drop sharply. According to experts, the US Federal Reserve may release high data as a sign of further increasing rates. This creates a sense of risk aversion. Markets are still feeling the knock-on effects of the Russia-Ukraine war. In this case, traders will be prepared for a higher CPI than they expected. The downward pressure on BTC indicates that losses in the coin will be much larger than any gains in the near term. AmkNews.com As we have also reported, BTC fell to $26,000 after the April CPI data.
How low can BTC go?
Technical indicators show that BTC is currently playing a descending triangle pattern. The coin is more prone to future losses than gains. Crypto analyst Mark Yusko paints a worst-case scenario where the longer BTC spends in this pattern, the more likely it is to drop 50 percent from current levels to $15,000. The analyst uses the following statements:
The longer #Bitcoin stalls in this descending triangle bouncing around $30k, the greater the risk of a final puke to $15k…
— Mark W. Yusko #TwoPointOneQuadrillion (@MarkYusko) June 10, 2022
Such a collapse would result in BTC falling nearly 80 percent from its record high of $68,000 in November. In a survey filed by Yusko, the majority of 1,000 respondents expect a drop of as much as $15,000. The largest cryptocurrency is trading at $30,122, down 0.8 percent at the time of writing.
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