Stability in PPI boosts Bitcoin as Fed mulls monetary policy
Bitcoin price saw a notable surge following the release of US Producer Price Index (PPI) data. The stability in the monthly PPI and the increase in the annual core PPI suggest that the Federal Reserve may continue with rate cuts. This has created a favorable environment for cryptocurrencies this Friday.
Bitcoin price currently stands at $62,540, up 3.67% over the past 24 hours / TradingView
Bitcoin and the impact of PPI data
The recent September PPI report paints a mixed picture that could have significant implications for the dollar and Bitcoin. The monthly PPI stood at 0.0%, below the 0.2% forecast, indicating that output-level inflation is not increasing as expected. On the other hand, the annual core PPI reached 2.8%, exceeding the 2.7% forecast, which could signal stronger inflationary pressures in the medium term.
Bitcoin Market Reaction to PPI
Bitcoin price is currently at $62,540, up 3.67% over the past 24 hours. This increase comes in a context where the price remains above the EMA200 of 60,042.80, suggesting a long-term bullish trend. The RSI of 53.63 indicates that the asset is not overbought, leaving room for possible further growth.
Likely Scenarios for Bitcoin
Bullish Scenario: If Bitcoin breaks the resistance at 63,417.56, it could continue towards $65,000, supported by strong open interest in futures and positive netflow in Bitcoin ETFs.
Bearish Scenario: A drop below the EMA200 could lead to a correction towards $60,000, especially if short liquidation volume increases.
Market Sentiment Analysis
The rise in futures open interest (+4.78%) and the long/short ratio of 1.4979 reflect an optimistic sentiment in the market. This, coupled with a positive netflow of USD 1.73 billion in futures, suggests that investors are willing to take long positions, which could push the price higher.
The Bitcoin market presents a positive short-term picture, with technical indicators suggesting a continuation of the uptrend. However, resistance at higher levels and the possibility of a correction should be considered. Investors should watch for signs of changing volume and open interest to adjust their strategies accordingly.
Disclaimer: This article is for informational purposes only and does not constitute financial advice.