Bitcoins
Bitcoin
price approached the psychological barrier of $100,000 following December’s
inflation increase in the United States. Along with BTC, altcoins also rose as
investors anticipate the Federal Reserve may be forced to cut rates sooner than
planned13.
Why is Bitcoin Up? US CPI
Inflation Rose 0.4% in December 2024
On
Wednesday, January 15, 2025, the US Bureau of Labor Statistics (BLS) reported
that the Consumer Price Index (CPI) increased by 0.4% last month.
“The
Consumer Price Index for All Urban Consumers (CPI-U) increased 0.4 percent on a
seasonally adjusted basis in December, after rising 0.3 percent in November.
Over the last 12 months, the all items index increased 2.9 percent before
seasonal adjustment,” the BLS commented.
The higher
monthly inflation reading caused the CME FedWatch tool to indicate a 30%
probability of a rate cut at the March meeting. The cryptocurrency market,
anticipating interest rate cuts, saw Bitcoin jump 1.4% to $98,500 immediately
after the report, eventually reaching a local daily high of $99,400.
Why is Bitcoin going up? Source: CoinMarketCap.com
This price
action validated yesterday’s bullish doji candle (or pin bar) formation, which
emerged when BTC briefly dipped below $90,000. If the trend continues, surpassing the $100,000 level should only be a matter of time. This would pave the way for Bitcoin to retest its all-time high above $108,000.
Paul Howard, Wincent
“Crypto
remains a key indicator of risk assets, and with CPI and inflation figures
exceeding expectations, this improvement is evident in current pricing,” Paul
Howard, Senior Director at Wincent, commented for Finance Magnates. “As
a leading liquidity provider in digital assets, we anticipate a highly volatile
week ahead, particularly with the transition of administration in the US, which
could result in +/-10% price swings for major assets like BTC, SOL, ETH, and
XRP.”
Why Is Crypto Up Today?
Ethereum and Other Altcoins Follow Bitcoin’s Lead
Altcoins
quickly followed Bitcoin’s lead. Ethereum , the second-largest cryptocurrency by
market capitalization, rose 3% in the past hour to $3,300, while XRP jumped
2.6% to $2.57.
The total
cryptocurrency market capitalization increased by 5.6% to $3.33 trillion, with
daily trading volume surging 25% to $154 billion according to CoinMarketCap
data.
Bitcoin and altcoins are going up. Source: CoinMarketCap.com
“Market
pricing will likely respond to announcements made by the incoming President,
suggesting that current valuations may not fully account for upcoming news,”
added Howard. “Many of these expected announcements are likely to have
long-term implications throughout the year, especially in areas such as
regulatory clarity, adjustments to banking policies, and leadership in matters
like a strategic bitcoin reserve.”
Bitcoin
price approached the psychological barrier of $100,000 following December’s
inflation increase in the United States. Along with BTC, altcoins also rose as
investors anticipate the Federal Reserve may be forced to cut rates sooner than
planned13.
Why is Bitcoin Up? US CPI
Inflation Rose 0.4% in December 2024
On
Wednesday, January 15, 2025, the US Bureau of Labor Statistics (BLS) reported
that the Consumer Price Index (CPI) increased by 0.4% last month.
“The
Consumer Price Index for All Urban Consumers (CPI-U) increased 0.4 percent on a
seasonally adjusted basis in December, after rising 0.3 percent in November.
Over the last 12 months, the all items index increased 2.9 percent before
seasonal adjustment,” the BLS commented.
The higher
monthly inflation reading caused the CME FedWatch tool to indicate a 30%
probability of a rate cut at the March meeting. The cryptocurrency market,
anticipating interest rate cuts, saw Bitcoin jump 1.4% to $98,500 immediately
after the report, eventually reaching a local daily high of $99,400.
Why is Bitcoin going up? Source: CoinMarketCap.com
This price
action validated yesterday’s bullish doji candle (or pin bar) formation, which
emerged when BTC briefly dipped below $90,000. If the trend continues, surpassing the $100,000 level should only be a matter of time. This would pave the way for Bitcoin to retest its all-time high above $108,000.
Paul Howard, Wincent
“Crypto
remains a key indicator of risk assets, and with CPI and inflation figures
exceeding expectations, this improvement is evident in current pricing,” Paul
Howard, Senior Director at Wincent, commented for Finance Magnates. “As
a leading liquidity provider in digital assets, we anticipate a highly volatile
week ahead, particularly with the transition of administration in the US, which
could result in +/-10% price swings for major assets like BTC, SOL, ETH, and
XRP.”
Why Is Crypto Up Today?
Ethereum and Other Altcoins Follow Bitcoin’s Lead
Altcoins
quickly followed Bitcoin’s lead. Ethereum , the second-largest cryptocurrency by
market capitalization, rose 3% in the past hour to $3,300, while XRP jumped
2.6% to $2.57.
The total
cryptocurrency market capitalization increased by 5.6% to $3.33 trillion, with
daily trading volume surging 25% to $154 billion according to CoinMarketCap
data.
Bitcoin and altcoins are going up. Source: CoinMarketCap.com
“Market
pricing will likely respond to announcements made by the incoming President,
suggesting that current valuations may not fully account for upcoming news,”
added Howard. “Many of these expected announcements are likely to have
long-term implications throughout the year, especially in areas such as
regulatory clarity, adjustments to banking policies, and leadership in matters
like a strategic bitcoin reserve.”
Damian Chmiel Read More