Bitcoin (BTC) experienced a notable drop of 2.3% as the latest inflation figures from the US indicated a downward trend, inciting fears surrounding the ongoing trade war. This was particularly evident at the March 13 Wall Street open, where BTC/USD hovered around $81,500.
The recent print of the Producer Price Index (PPI) showcased a decline below median expectations, echoing the Consumer Price Index (CPI) results released the previous day. According to data, the PPI advanced by 3.2% over the past year, with fluctuations in prices for final demand goods and services contributing to the current market scenario.
This favorable inflation news appears to be having an adverse effect on cryptocurrencies and traditional stocks, with many analysts attributing this phenomena to heightened concerns about a possible escalation in the US trade war. The Kobeissi Letter remarked that the muted reaction from markets following positive inflation data is indicative of traders’ sentiments. “This data provides President Trump a reason to maintain his current course of action,” they noted.
Ahead of the Federal Reserve’s impending interest rate decision, analysts have suggested that market expectations remain tepid, with the likelihood of a rate cut relegated to just 1% at this juncture. Traders continue to brace themselves for a period of volatility, particularly in light of the recent inflation trends.
This price inertia in Bitcoin not only reflects resistance levels but also indicates an ongoing struggle for momentum. Bitcoin currently lies between buy and sell liquidity bands, with the 200-day simple moving average (SMA) acting as a significant resistance point. For four consecutive days, BTC has struggled to reclaim this critical level, a situation noted by trading experts, including Keith Alan, co-founder of a prominent trading resource.
In the wider market, the chances for upside momentum seem surrounded by formidable resistance, particularly under the $85,000 mark as indicated by recent data analyses. Market participants are urged to exercise caution and perform thorough research before engaging in trading decisions, especially in the fast-paced crypto environment.
This article does not comprise investment advice and every investment move entails risk. Readers are encouraged to conduct their own investigations and consider various factors impacting the cryptocurrency market.
