Key Points
- Bitcoin's price increased by 3% on May 13, with expectations of price volatility due to upcoming U.S. macroeconomic data.
- Analysts suggest that reducing inflation could benefit risk assets like Bitcoin, potentially triggering a market rise.
Bitcoin's price saw a 3% increase on May 13. This rise came as crypto traders anticipated price fluctuations in the lead up to the week's U.S. macroeconomic data update.
During the day, the price of Bitcoin reached a high of $63,269 on Coinbase following the Wall Street open.
Market Anticipations
This week, market participants are awaiting U.S. inflation data which will play a crucial role in determining whether the Federal Reserve will lower interest rates in 2024. The U.S. Producer Price Index (PPI) print is due on May 14, followed by the Consumer Price Index (CPI) reading on May 15.
According to market analysts' predictions, there is a 72% chance of rates remaining the same at the Federal Open Market Committee (FOMC) meeting in July. The possibility of rate cuts later in the year stands at 48.6% for the September meeting. For the June meeting, traders forecast a 91.1% chance that rates will stay the same.
Analysts' Opinions
Analyst Tedtalksmacro noted that inflation data is the main focus this week and predicted volatility. He suggested that a decrease in inflation could benefit risk assets like Bitcoin, potentially leading to a market surge.
Another analyst, Seth, stated that the upcoming "CPI, Core CPI, PPI, and FED chair speech" will likely impact Bitcoin's price direction. He suggested that the U.S. economy might not be as strong as data suggests.
Bitcoin's Potential Rebound
Bitcoin has been in a downtrend since it deviated from its all-time high of $73,835 on March 14. The price has recorded a series of lower highs and lower lows, with the relative strength index (RSI) reaching near-oversold conditions at 33 on May 1.
The Coinbase Premium Index, an indicator that shows the percentage difference between the BTC/USDT pair on Binance and the BTC/USD pair on Coinbase Pro, has followed Bitcoin's price action. If this indicator turns negative and then reverses from a downward to an upward trend, Bitcoin's price has always rebounded historically.
Crypto trader Moustache expressed optimism, arguing that current market movements should result in a more sustained upside as in previous post-halving cycles. He suggested that weak market players need to exit before Bitcoin can rise toward $80,000.
