Bitcoin Stuck at $63,500 as Market Awaits Fed Rate Decision

Bitcoin's price has been fluctuating around the $63,500 level as investors wait for more clarity on the US Federal Reserve's next move. The July consumer price index (CPI) data was released on August 12 and showed a 0.1% increase from the previous month and 3.4% from a year earlier, matching market expectations.

Despite the stable inflation data, bitcoin's price dropped to around $63,500, and the currency has yet to reflect the positive impact of the Fed's expected rate hold in September. According to CME Group's FedWatch tool, the probability of the Fed keeping rates steady at 3.50 to 3.75% is now at 60%, double the 30% seen a month earlier.

Fabian Dori, chief investment officer at Signum Bank, views the CPI alongside a cooling labor market as potentially lowering the need for additional rate hikes. However, Andrei Grachev, managing partner at DWF Labs, notes that the bitcoin options market is still attaching a premium to downside protection.

Technically, warnings continue that support at $63,000 is weakening, with upward momentum slowing down and rebound sizes shrinking. Bitfinex's research unit Bitfinex Alpha points out that overhead resistance remains clear, with bitcoin repeatedly being capped in the $65,000 to $65,500 range.