Bitcoin price sees new 2023 high as CPI sends BTC price above $26K
Bitcoin (BTC) spiked above $26,000 on March 14 as United States Consumer Price Index (CPI) data showed mixed inflation signals.
CPI fuels 9-month BTC price highs
Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as sudden volatility kicked in on the release of February’s CPI numbers.
Inflation climbed 6% year-on-year, while the month-on-month figure was 0.4% — both in line with expectations. Items excluding food and energy increased by 0.5%, slightly higher than forecast.
US #inflation data more or less in line. Feb Overall CPI +6% YoY from 6.4% in Jan, Core CPI 5.5% in Feb down from 5.6& YoY in Jan. pic.twitter.com/k8rzsmdqVA
— Holger Zschaepitz (@Schuldensuehner) March 14, 2023
Bitcoin appeared to react positively to the data, which allowed the Federal Reserve to avoid being trapped between stickier inflation and avoiding interest rate hikes amid an ongoing banking crisis.
Reacting, Venturefounder, a contributing analyst at on-chain analytics platform CryptoQuant, suggested that the market was now anticipating a “pivot” on hikes — a key boon for risk assets more broadly.
“The market: oh yes big victory on fighting inflation! No more rate hikes and Fed is gonna cut rate by 50 BPS before EoY 2023,” he tweeted.
“If Powell changes the 2% inflation target it will be the biggest rug move by the Fed since the 1970s taking USD off gold standards.“
Trading resource Game of Trades nonetheless argued that CPI was not yet low enough for the Fed to “aggressively” change its stance and echo actions that followed the March 2020 COVID-19 crash.
“Consensus gets it spot on as CPI comes in at 6%. But it’s not low enough to give the Fed room to aggressively step in during the ongoing crisis, as it did during C19,” a tweet read.
Volatility ongoing as BTC price eyes $26,000
CPI is notorious for sparking unpredictable BTC price moves, and as such, the picture remained unclear at the time of writing as to where BTC/USD would head next.
Related: Bitcoin price nears $25K as analysts place bets on CPI impact
Before the CPI release, significant sell-side liquidity was parked at $25,000 and beyond; the main target of bulls on low timeframes.
Bitcoin’s local highs of $26,150 marked a new record for 2023 — its best performance since June last year.
BTC/USD took out the key 200-period moving average, acting as resistance on weekly timeframes.
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