Bitcoin (BTC) hit multi-day lows through Aug. 10 as crypto traders braced for the impact of fresh inflation data out of the United States.
BTC/USD 1 Hour Candlestick Chart (Bitstamp). Source: TradingView
Trader: The market “might get ugly” if CPI keeps rising
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD falling to $22,668 at the most recent daily close on Bitstamp, its lowest level since Aug. 5.
The bullish momentum had evaporated the day before and sentiment among traders was clearly risk-off as markets awaited the latest Consumer Price Index (CPI) data.
Data for July was due at 8:30 am ET on August 10, with expectations calling for it to show that US inflation has already peaked.
“CPI prints have been quite instrumental in BTC price action,” said William Clemente, Blockware’s lead insights analyst wrote in part of a tweet about the event, adding that CPI would make a “big day” for crypto.
An accompanying chart showed the impact of previous CPI readings on BTC/USD.
Annotated BTC/USD chart with CPI events. Source: William Clemente/Twitter
Trader and analyst Daan Crypto Trades, meanwhile, gave a CPI reading of 9.1 or higher as “bearish” for price action versus current expectations of 8.7.
CPI Guide for today in my opinion:
CPI YoY:
8.7-9.1 Neutral likely slightly down
9.1> BearishCore CPI YoY
5.9-6.1 Neutral
6.1> BearishMore thoughts below
— Daan Crypto Trades (@DaanCrypto) August 10, 2022
“The market has been pumping on the idea that inflation has probably peaked over the past month,” he wrote in a dedicated thread.
“If it doesn’t get that confirmation today, it could get ugly in the near term as the peak is likely pushed back another 1-2 months. Which likely means a delayed Fed pivot as well.”
Meanwhile, macro analyst Alex Krueger was more dismissive, vocation CPI a “small number” while acknowledging its impact on risk asset trends.
BTC price is still far from the bullish pivot zone
BTC price action thus remained wedged within a familiar range, with classic support and resistance levels still in play.
Related: Bitcoin dominance hits 6-month low as metric proclaims new “alternate season”
BTC/USD is circling $23,000 at the time of writing, after falling more than $1,000 the previous day.
Daan Crypto Trades identified $24,300 as a crucial level to break and hold for Bitcoin to “fly,” with $21,000 a potential target in the event of a breakdown.
$BTC A critical support level is being tested here, with the 4H 200EMA below at $22.7k.
If we were to get a full collapse the logical target would be a low $21,000.
Break and hold above $24.3K and we fly.
These are my levels that I will be watching for now. pic.twitter.com/UrDmxuebGf
— Daan Crypto Trades (@DaanCrypto) August 9, 2022
On-chain monitoring resource Whalemap, meanwhile, continued its analysis of whale buying and selling levels.
“$BTC is back in whale aggregation territory”, the Whalemap team summarized on August 9th.
“Prices where whales accumulate usually act as support or resistance for bitcoin’s price action. The question is whether we will get a jump again or go deeper.
Annotated chart of Bitcoin Whale wallet inflows. Source: Whalemap/Twitter
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