Bitcoin’s price dropped by around 2% in the last 24 hours, now sitting at about $60,320 on October 10 as traders wait for key U.S. inflation data. It comes on the first day of similar declines in U.S. stock market futures ahead of the release of September’s Consumer Price Index (CPI) report.
The figures on the CPI and the core inflation for September are forecasted to rise by 0.1 percent and 0.2 percent respectively, down from August levels — according to a Bloomberg survey. Lowering the inflation rate could mean the Federal Reserve may consider cutting interest rates, the CME data projects a 80 per cent probability of a 25 basis point cut in November.
Bitcoin Fed Rate Impact
At the same time, the odds of a Fed rate hold have spiked to 20 percent, from zero a week ago.Times have been historically, when lower interest rate boosted Bitcoin and the broader crypto market, as lower rates tend to be positive for risk on sentiment.
But then traders tend to pare their exposure to volatile assets like cryptocurrencies ahead of important U.S. economic indicators. In addition to that, Bitcoin’s derivatives market open interest has rocketed above $18 billion, indicating the possibility of market corrections.
CryptoQuants’ Aytekin has pointed out that there might be long liquidations, which could provide some stability to the market. During this, however, despite it, funding rates are low and any correction to price may be shallow.
The daily relative strength index (RSI) has rebounded from near oversold territory and Bitcoin’s current price holds above the key support of $60,000-$60,500. In these technical indicators this indicates a possible recovery, and if Bitcoin reaches the 200 exponential moving average (EMA) around $61,800 in the next few days or weeks.
