Could Bitcoin Price Drop to $75,000 Before US CPI Data Release?

Bitcoin price has suffered another sharp decline, plunging by 4.5% to around $80,350 as investors brace up for the upcoming US Consumer Price Index (CPI) data release. The broader crypto market has also felt the impact, with over $170 billion wiped out in just 24 hours. Market analysts warn that further downside risks could be on the horizon.

Technical Indicators Point to Further Bitcoin Decline

 Bitcoin has been struggling to gain pace facing strong rejection at $92,500, causing it to lose over 11% in a week. It is particularly worrying that more than $1billion worth of BTC long positions were liquidated in a day, signifying the heightened risk in the crypto market.

Peter Brandt, a veteran trader, is noticing a bearish pennant forming in Bitcoin’s price chart creating the case for an impending price drop. Two significant developments that support his unconditional downward dip sentiments were the double top at 108,100 and a failure to retest at 95,321. With short term support at 81,513 marked, Brandt also believes that the pennant formation can lead to further declines.

Head of the BitMEX exchange, Arthur Hayes, does not seem too positive on Bitcoin’s future either as he notes that it might still have more room to drop and the bearish pressure is still in place. In the five days from March 3 to March 7, Bitcoin ETFs also suffered massive outflows where investors virtually pulled out 799 million dollars. Even Fidelity’s Bitcoin ETF (FBTC) declined by 201 million dollars, which can only indicate diminishing institutional interest.

US CPI Data Release Could Shape Bitcoin’s Next Move

The United States CPI data is scheduled to be released sometime before March 12 and investors will be paying close attention to it. This report can help shed some light on inflation and can have an impact on the Federal Reserve’s decision regarding interest rates. However, according to Bloomberg, core CPI is expected to increase by 0.3% which is a positive sign towards controlling inflation, although it may not be considered as a significant change. 

• Find out more info about Binance Referral ID

The scenario where the CPI comes out higher than expected would most likely add to the Fed’s rate hike skeptical outlook, which could mean that rate hikes would be held steady for a longer time. This could worsen the situation for Bitcoin and other riskier assets. On the other hand, increased cooling in inflation data could relieve some pressure on the crypto market. 

For the time being, Bitcoin remains in bearish conditions and looks like the upcoming CPI report may influence what direction the price will move in next. Keeping in mind the current selling pressure, it does look like $75,000 will become the next most prominent support zone for investors.