Bitcoin Dives Below $63K as US Inflation Data Fails to Boost Price
The price of Bitcoin (BTC) fell below $63,500 on Wednesday as markets reacted to key US inflation data. The Consumer Price Index (CPI) figures matched expectations, but this did not inject volatility into risk assets.
In a report from the Bureau of Labor Statistics (BLS), CPI inflation rose 0.1% month-on-month and 3.4% year-on-year. Fabian Dori, CIO at Sygnum Bank, noted that the cooling CPI data combined with weak labor-market figures to potentially bolster the case for the Federal Reserve avoiding interest-rate hikes.
The odds of the Fed holding rates at the current 3.50-3.75% level at its September meeting increased to 60%, according to CME Group's FedWatch Tool. Thursday will provide another key macro report, with the July Producer Price Index (PPI) numbers set to be released.
Rekt Capital warned that the $63,000 support for BTC is progressively weakening, and that at some point the bounces will become so weak that the floor will simply break. The 50-month exponential moving average (EMA), currently at $65,827, has become new resistance for Bitcoin.