Bitcoin’s price surged by 7.50% to $66,350 following the release of the latest U.S. inflation data. The U.S. consumer price index (CPI) increased by 0.3% in April, slightly lower than the previous months. This lower-than-expected increase indicates a cooling inflation trend, which could lead to a potential interest rate cut by the Federal Reserve in September. The market expects this development to have positive implications for the economy, signaling a slowdown in domestic demand and aligning with the Fed’s goal of achieving a soft landing without triggering a recession.
Shelter costs and gasoline prices were key drivers of the CPI increase in April, accounting for over 70% of the overall rise. Shelter costs, including rents, saw a 0.4% increase for the third consecutive month, while gasoline prices surged by 2.8%. In contrast, food prices remained unchanged, with significant decreases in supermarket prices for items like eggs. Year-over-year, the CPI increased by 3.4% in April, showing a slight decrease from the previous month. Economists believe that inflation is moderating as predicted, with expectations that the downward trend will continue in the coming months.
Federal Reserve Chair Jerome Powell’s dovish stance on inflation has further weakened the U.S. dollar, leading to a surge in Bitcoin’s price. Powell expects inflation to continue moving downward towards the Fed’s 2% target, prompting financial markets to anticipate a possible rate cut in September. Some economists even speculate that a rate cut could come as early as July. This expectation has positively impacted stock markets, with Wall Street trading higher, the dollar weakening against other currencies, and U.S. Treasury prices rising, contributing to Bitcoin’s price rally as investors seek alternative assets amid changing monetary policies.
Bitcoin is currently trading at $66,350, up 7.50%, with bullish price predictions suggesting a strong rally. The breakout from a symmetrical triangle pattern around the $63,300 level is confirmed by significant bullish engulfing candles, indicating robust upward momentum. However, caution is advised as recent candlestick formations and an overbought RSI of 78 could signal a potential bearish correction. Key price levels to watch include immediate support at $63,300 and resistance at $67,300, $68,545, and $70,000. The 50-day Exponential Moving Average at $62,565 serves as critical support, reinforcing the bullish trend, but a break below the pivot point at $65,150 could trigger a selling trend targeting $63,300.
In conclusion, the outlook for Bitcoin remains bullish above the $65,150 pivot point, with the potential for a sharp selling trend if this level is breached. As the market experiences significant movements, an opportunity in the crypto world is highlighted through the Sealana presale. Sealana, a chubby seal in the Solana Sea, is immersed in the degen market and offers a chance to buy $SEAL tokens at just $0.022 in the presale. With impressive traction and a growing community, Sealana presents an exciting opportunity to explore the Solana ecosystem. However, it is essential to remember that crypto investments are high-risk, and caution should be exercised when considering such opportunities.
