Bitcoin price rallies to $29.4K as traders gear up for this week’s CPI print
Bitcoin (BTC) rose to its highest level in ten months on April 10 as traders await this week's April 12 consumer price index report to gain deeper insight into the Federal Reserve's fight against sticky inflation. If the report shows inflation dropping, it could be the next possible catalyst that further's BTC's upward move.
On April 10, BTC price soared 3.37% to over $29,300 after a quiet Easter weekend. Interestingly, Bitcoin's intraday gains appeared alongside a drop in U.S. equities, a rare decoupling that highlights the coin's diminishing risk-on characteristics.
The Bureau of Labor Statistics will release March consumer price index (CPI) data on April 12, which expects to show inflation down to 5.1% from 6.0% year-over-year previously.
A slowdown in headline CPI increases the prospects of the Federal Reserve shifting in a more dovish direction. Conversely, persistent inflationary forces could lead traders to bet on more interest rate hikes in May.
Bitcoin's rise above $29,000 suggest that crypto traders have been pricing in a drop in inflation, which, in turn, could lead to a potential Fed pivot.
Nonetheless, the U.S. dollar index (DXY), which tracks the greenback's strength against a basket of top foreign currencies, climbed 0.7% on April 10, which, alongside a weaker U.S. stock market, shows macro investors see a rate hike ahead.
In fact, the market sees a 70% probability of the Fed lifting rates by 25 basis points in their meeting in May, according to the CME Fed Watch Tool. That could be due to a tightening labor market that gives the Fed more ammunition to continue raising lending rates in the future.
From a fundamental perspective, Bitcoin looks prepared to hit $30,000 ahead of the Fed FOMC. However, its
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