Bitcoin Price Climbs to $29,400 as Traders Prepare for This Week’s CPI Print

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Bitcoin (BTC) hit a ten-month high on April 10 as traders await this week’s April 12 Consumer Price Index report to better understand the Federal Reserve’s fight against the coronavirus. persistent inflation. If the report shows a decline in inflation, this could be the next possible catalyst for BTC’s rise.

On April 10, the price of BTC soared 3.37% to over $29,300 after a quiet Easter weekend. Interestingly, Bitcoin’s intraday gains emerged alongside a decline in US equities, a rare decoupling that highlights the coin’s diminishing risk characteristics.

Year-to-date BTC/USD returns versus US stock indices. Source: TradingView Pre-IPC momentum may be in effect

The Bureau of Labor Statistics will release March consumer price index (CPI) data on April 12, which forecasts inflation falling to 5.1% from 6.0% year-on-year previously.

A slowdown in the headline CPI raises the outlook for the Federal Reserve to move in a more accommodative direction. Conversely, lingering inflationary forces could lead traders to bet on further interest rate hikes in May.

Bitcoin’s rise above $29,000 suggests that crypto traders have been pricing in lower inflation, which, in turn, could lead to a potential Fed pivot.

Nonetheless, the US dollar index (DXY), which tracks the strength of the greenback against a basket of major foreign currencies, climbed 0.7% on April 10, which alongside a stronger US stock market low, shows that macro-investors expect rates to rise in the future.

DXY daily price chart. Source: Trading View

In fact, the market sees a 70% chance that the Fed will raise rates by 25 basis points at its May meeting, according to the CME Fed Watch Tool. This could be due to a tightening labor market giving the Fed more ammunition to continue raising lending rates in the future.

Could Bitcoin reach $30,000 in April?

From a fundamental perspective, Bitcoin looks set to hit $30,000 ahead of the Fed’s FOMC. However, its likelihood of retaining these gains will depend on inflation data, as mentioned above.

Related: CPI To Trigger Dollar Massacre 5 Things To Know About Bitcoin This Week

Meanwhile, from a technical analysis perspective, Bitcoin needs to close above its weekly resistance range defined by the $29,500-$32,000 area to target a climb towards $40,000.

BTC/USD weekly price chart. Source: Trading View

This range served as support for the sessions from December 2020 to February 2021, from May 2021 to July 2021 and from January 2022 to March 2022.

In the event of a pullback from the mentioned range, the price of BTC risks a sharp decline towards its 50-week exponential moving average (50-week EMA; the red wave) near $25,250 and its 200-week exponential moving average (200-week EMA; the blue wave) near $25,000.

The views, thoughts and opinions expressed herein are the sole authors and do not necessarily reflect or represent the views and opinions of Cointelegraph.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

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