On June 12, Bitcoin (BTC) remained stable despite a brief macroeconomic data jolt, with the cryptocurrency circling around $26,000 and avoiding significant volatility. The latest United States Consumer Price Index (CPI) print came in lower than expected, causing a brief spike towards $26,500. While this was seen as a boon to risk assets, crypto markets remained cautious with comments from the Federal Reserve and further macro prints expected.
Bets on the Fed pausing its rate hike cycle on June 14 after the meeting of the Federal Open Market Committee (FOMC) climbed following the CPI event. CME Group’s FedWatch Tool showed the odds of the Fed pausing its rate hike cycle at over 90%, up from 75% earlier in the day.
“Disinflation continues!” said financial commentator Tedtalksmacro. “Headline CPI prints at +4.0% YoY, which now takes the 3-month annualised rate to +2.21%. The Fed has long targeted 2.0%. PAUSE.” Trading firm QCP Capital also believed that the Fed would not raise rates further, at least this time. “Based on high frequency indicators, US inflation is falling rapidly, which will enable the FOMC to make this week’s meeting their first pause in more than a year,” it wrote in a market update on the day.
Multiple commentators noted that BTC/USD had closed the gap in CME Bitcoin futures from the weekend. Analyzing what could come next, Michaël van de Poppe, founder and CEO of trading firm Eight, was torn, nonetheless flagging $25,000 as a potential downside entry point. Data from the Binance order book uploaded to social media by monitoring resource Material Indicators showed a lack of liquidity near spot price prior to the print, with clearly defined support and resistance.
“Bulls are looking for a boost from the Economic Data coming today and tomorrow to reclaim the range,” part of a prior post commented about daily timeframes.
While the latest US inflation data came in below expectations, Bitcoin remained stable and avoided major volatility. The Fed is expected to pause its rate hike cycle, with the odds of this happening standing at over 90% at the time of writing. Despite this, trading firm QCP Capital believed that subsequent FOMC meetings may yield different results, in order to “appease” more hawkish committee members. The lack of liquidity near spot price prior to the print was noted by monitoring resource Material Indicators, with clearly defined support and resistance.