Bitcoin’s daily trading volumes surge by 76% in the last 24 hours just a day before the US reports PPI and CPI inflation numbers. Any positive development could lead to a breakout above $64,000.
After facing some selling pressure over the last weekend, the world’s largest cryptocurrency Bitcoin (BTC) bounced back above $63,000 earlier today. As of press time, Bitcoin is trading 2.96% up at $62,715 with a market cap of $1.235 trillion.
The interesting thing is that Bitcoin’s daily trading volume has jumped by 76% to over $23 billion. This surge in the BTC trading activity comes ahead of the release of the US inflation data numbers ahead of this week.
As per the current economic data, America has been experiencing a slowdown in the economy in comparison to its robust performance last year. For the month of April, the US employment numbers highlighted weaker growth than the market estimates.
If this situation continues further, it could force the Federal Reserve to cut down on interest rates to prevent any major downturn in the US economy. As a result, investors are looking for confirmation regarding the ongoing presence of inflation. This data could offer additional clarity on the scale, timing, and probability of interest rate reductions throughout the year.
All Eyes on the US CPI Numbers
This week, the market will get more insights into the US inflation numbers. On Tuesday, the United States will be releasing the Producer Price Index (PPI) data while a day later on Wednesday, they will share the Consumer Price Index (CPI).
Before this week’s inflation reports, the CME’s FedWatch tool predicts a 24.6% possibility of a rate cut at July’s Federal Open Market Committee (FOMC) meeting and a 48.6% chance at September’s meeting. Interest traders anticipate a 96.5% likelihood of unchanged rates at June’s meeting. Analysts at QCP Capital wrote:
“Unless the Fed clearly rules out rate cuts or hints at rate hikes, it seems like the markets will continue to price in cuts. These expectations are likely to keep a bullish tone in the market for a while.”
So far the Bitcoin price has managed to stay above the crucial support levels of $60,000. However, on the upside, it has always failed to surge past $64,000, and thus trading in the narrow range.
#Bitcoin is holding up onto the crucial level of support.
I’d favor holding here.
Losing $60K might be due to news items, but losing that level suggest that a test between $52-55K is next.
Continue to accumulate and be patient. pic.twitter.com/86FWbn614L
— Michaël van de Poppe (@CryptoMichNL) May 13, 2024
However, if the BTC price fails to give a convincing breakout above the resistance of $64,000, it can see further pullbacks under $60,000. Popular crypto analyst Michael van de Poppe stated that losing $60,000 can lead to a further 15% correction in BTC price.
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