Bitcoin BTC$103,870.71 It could ease trade tensions between the US and China, and could respond positively to a potential slowdown in CPI this April, causing an increase in acceleration in the wider Altcoin market, which could soon reach record-breaking price highs.
The US has reached a trade deal with China after two days of high-level negotiations in Geneva, US Treasury Secretary Scott Bescent and trade representative Jamieson Greer announced on Sunday. The two countries will issue a joint statement on the Geneva trade talks later on Monday.
The trade contract comes weeks after a week-long trade war, where the two countries threaten to raise import tariffs by more than 100% and inject inflation into the global economy. So, the positive US consumer price inflation data released last month was largely rejected by investors and analysts as a delayed indicator that did not accurately reflect escalating trade tensions.
But the bear can no longer have that argument thanks to the trade contract.
So, continuing to soften the CPI will allow you to raise the FRB rate reduction bet, providing a bullish catalyst for BTC rally to record highs above $110,000. Meanwhile, the hotter than expected CPI could be rejected as a retroactive reflecting its lack of consideration of trade tension attitudes, reflecting April’s tariffs.
According to the RBC, Tuesday’s CPI is expected to show a relaxed cost of living from 2.4% in March to 2.3% in April. The core CPI, which excludes food and energy, stays at 2.8% year-on-year in April, and is expected to continue to maintain rent inflation.
According to a 10x survey, the consensus is that the headline CPI in April likely did not change at 2.4%.
“If this expectation is achieved, the market may view the inflation report as positive. With the exception of negative tariff headlines, this week’s inflation data could provide a bullish catalyst.”
“The CPI is bullish and could potentially bring to life the highest ever high,” Thielen added.
Bitcoin, the leading cryptocurrency by market value, changes hands at around $104,000 and hits a new high above $109,350, just 5.1% shortfall, Coindesk data shows.
BTC has received a V-shaped recovery from $75,000 since early April, with prices rising 10% last week as the inflow into spot exchange trading funds (ETFs).
According to SoSovalue data, BlackRock’s Spot Bitcoin ETF (IBIT) has registered a net inflow of 20 straight trading days on 20 straight trading days, raising over $5 billion in investors’ money. Last week, the Federal Reserve changed its benchmark borrowing costs in the range of 4.25% to 4.5%, repeating its data-dependent stance on potential rate reductions. However, Chairman Jerome Powell provided a hint of dovish, saying, “The fundamental inflation picture is good,” and that it is causing short-lived inflation effects.
According to TradingView, Ether, the second-largest cryptocurrency, rose 39% last week to $2,500, the best performance since December 2020. Other major altcoins such as XRP, DOGE, ADA, and SOL were 9.7%, 56%, 19%, and 20% respectively.
According to a study by HTX, there are no signs of speculative frenzy yet. This means that the meeting could continue.
“The implicit volatility (IV) of Bitcoin options remains stable in the 50%-55% range, far below the extreme level+ extreme level seen at past bull market peaks.
“Unless yields return above 4.8%, as long as the ETF inflow remains stable, Bitcoin is likely to consolidate in the $105,000-115,000 range while waiting for the next breakout trigger,” HTX added.
