Bitcoin is hovering around $61,000, and data released later today could push it over the edge along with the broader crypto market.
The U.S. consumer price index for May is scheduled to be released at 8:30 a.m. ET. The figures mean the cost of living in the world’s largest economy is expected to rise 4.2% year-on-year, the highest level in three years, following a 3.8% rise in April, Reuters reported.
That would push inflation more than 2 percentage points above the Fed’s 2% target. Concerns that the Fed is likely to raise interest rates are already weighing on Bitcoin, and further evidence is likely to cause the largest cryptocurrency to fall further.
That being said, Bitcoin’s reaction will depend more on what’s underneath than the headline numbers.
The key question is whether inflation has spread across multiple categories or remains concentrated in the energy sector. If it’s the latter, there’s a good chance the market will dismiss this print as a temporary effect of the first quarter’s spike in oil prices due to the war with Iran.
This seems plausible given that the CBOE Crude Oil Volatility Index (OVX) has already cooled to pre-war levels and WTI crude oil has fallen more than 16% to $87 per barrel in the last month. It continues to trade around that level.
MUFG Research said: “Core inflation (consensus forecast) of 0.3% m/m could prompt an initial small rise in interest rates if driven by temporary factors (such as fuel surcharges).” “However, if inflation rises, it will affect a market that is already in crisis and cause a small decline.”
For Bitcoin traders, better-than-expected numbers in several sectors have increased the chances of Bitcoin trading below $60,000. Traders are already pricing in year-end rates at least 25 basis points above the current range of 3.50-3.75%, according to CME Federal Funds Futures.
On the other hand, a downside surprise could lead to a bailout rally, especially given that BTC appears oversold on key indicators such as the RSI.
In any case, volatility is likely to increase. The direction will be determined by the CPI. Be alert!
More information: For an analysis of today’s activity in altcoins and derivatives, see Today’s Crypto Market. For a comprehensive list of this week’s events, see CoinDesk’s “Crypto Week Ahead.”
what is trending
- Elon Musk’s SpaceX IPO was four times oversubscribed. Cryptocurrency bets tell a more cautious story (CoinDesk): SpaceX IPO priced at $135 per share. But on Hyperliquid, a “synthetic” stock with the ticker SPCX is already trading at $157.
- Japan’s three largest banks aim to jointly issue stablecoins by March (CoinDesk): Mitsubishi UFJ Financial Group (MUFG), Sumitomo Mitsui Financial Group (SMBC), and Mizuho Financial Group plan to establish a council to consider operational frameworks and prepare for stablecoin issuance during this fiscal year.
- Crude oil unstable after U.S. completes attack on Iran following Apache helicopter attack (CNBC): U.S. WTI crude oil futures for July delivery were little changed at $88.19 per barrel. Brent futures for August rose 0.14% to $91.58. This comes after the United States launched an offensive against Iran, raising concerns that new attacks could threaten shipping through the Strait of Hormuz.
- Bitcoin ETFs are not as big now as they were when President Trump won the election (CoinDesk): US spot Bitcoin ETFs are losing favor with investors. As of June 9, the 11 ETFs had total net assets of $77.58 billion, the same level they would have reached after President Donald Trump won the November 2024 election.
today’s signal
The chart shows that $XRPWeekly price trends in candlestick format from late 2023 onwards.
The price of the payments-focused cryptocurrency is below its 200-week simple moving average (SMA), a sign of a deepening bear market. This results in $XRP It remains at a disadvantage compared to Bitcoin, which is still trading near its 200-week SMA.
This breakdown suggests further decline towards the next support at the three-year-old high of $0.95 is possible. This was the level at which sellers outnumbered buyers in July 2023, reversing the rally back then.
