The latest CPI median forecast for October 2024 shows a year-over-year increase of 2.6% (unadjusted), a potential pivot after six straight months of declining figures since March 2024. If realized, October would register the first monthly rise in the year-over-year CPI since then.
September’s CPI increased by 2.4% YOY, just above the 2.3% estimate. In the past 12 months, CPI has outpaced forecasts in 5 months, matched them in 2, and lagged in 5. Looking at a broader 5-year horizon, CPI has exceeded the median estimate 52% of the time, matched it 17%, and come in below 32% of the time.
FactSet’s median estimate of 2.6% for October pulls from 12 estimates, with a range from 2.4% to 2.6% (a 20-basis-point spread), notably narrower than the recent 12-month average spread of 26 bps and the 5-year average spread of 49 bps.
For October’s Core CPI (excluding food and energy), the median forecast anticipates a 3.3% YOY increase.
The Bureau of Labor Statistics is set to publish the actual October CPI and Core CPI figures tomorrow, November 13.

#CPI

Master the Art of Candle Chart Patterns
Ever wondered how a small investment could grow exponentially? With Binance and the right trading insights, you can leverage a $90 starting point into potential big returns. Candle chart patterns are your gateway to understanding market trends and capitalizing on them. Here’s a deep dive into mastering these charts and turning your trades into strategic success!
What are Candle Chart Patterns?
Candle charts are more than just lines and colors—they’re visual stories of market sentiment. Each candle on a chart reflects the constant tug-of-war between buyers and sellers, revealing crucial insights about price movements and potential shifts.
Key Components of a Candle Chart:
1. ✨Opening Price – The initial price when the period begins.
2. ✨Closing Price – The final price at the end of the period.
3.✨ Highest Price – The peak price reached within the period.
4.✨ Lowest Price – The minimum price touched in the period.
Candle Anatomy:
Body:✨ Shows the price movement between the open and close, giving a snapshot of market pressure.
Wicks (or Shadows): Indicate the highs and lows, showing volatility within that timeframe.
Essential Candle Chart Patterns to Watch
Understanding key patterns allows traders to predict potential price reversals or trend continuations. Here are some must-know patterns:
1. Hammer ✨– Signals a potential reversal after a downtrend.
2. Inverted Hammer ✨– Indicates a potential trend reversal on the upside.
3. Bullish Engulfing✨ – Shows that buyers have overpowered sellers, often a bullish signal.
4. Bearish Engulfing ✨– Reflects seller dominance, often signaling a downward trend.
5. Doji✨ – A neutral pattern hinting at indecision in the market.
6. Shooting Star ✨– Signals a potential bearish reversal after an uptrend.
7. Bullish/Bearish Reversal Patterns✨ – Spot these to anticipate shifts in market direction.
Strategies for Profitable Trading Using Candle Patterns
___________________________________
Maximizing returns from candle charts requires more than pattern recognition. Implement these strategies to create an edge:
1. 🔰Identify Trends and Reversals: Patterns like the Hammer and Bullish Engulfing give early reversal signals.
2. 🔰Use Technical Indicators: Combine candle patterns with indicators like RSI (Relative Strength Index) and MA (Moving Averages) to confirm your analysis.
3.🔰 Set Stop-Loss and Take-Profit Levels: Define entry and exit points to safeguard your gains and manage risk.
4. 🔰Master Risk Management: Position sizing is key—don't overextend your investment in a single trade.
==================================
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2. 🥳Learn the Charts: Study the basics of candle charts and observe live markets.
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In trading, emotions can be your biggest hurdle. To keep yourself on track:
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The Journey from $90 to $6,000 Begins Now!
Every great trader started with a first step, often small. With patience, discipline, and mastery of candle chart patterns, you can make your way from a modest investment to potentially impressive returns. Dive in, keep learning, and start your Binance journey today!

#CPI #BTC☀ break120k2025pebruary

From developer and decentralized application (dapp) counts to progress along its roadmap to general public awareness, there are many metrics that may be used to measure Ethereum’s progress over time. One of the most popular is transaction count, which is notable not only due to its correlation with items like adoption and fee generation, but also as it measures actual usage of the protocol itself.Unfortunately, transactions on Ethereum are now down about 26% from their May 2021 peak, possibly suggesting that Ethereum is, at best, temporarily moving backwards and, at worst, in long-term decline.However, neither is true.You’re reading Crypto Long & Short, our weekly newsletter featuring insights, news and analysis for the professional investor. Sign up here to get it in your inbox every Wednesday.To better understand why Ethereum is thriving despite a falling transaction count, one must understand Ethereum’s plans for the future. While Ethereum can directly facilitate all blockchain activities on the mainnet (consensus, execution, data availability and settlement), it is pioneering a more modular approach, enabling certain functionality to be outsourced to separate, optimized protocols for improved performance. Chief among these is execution, with transactions outsourced to layer 2 (L2) rollups for more efficient execution.Multiple transactions are bundled together and executed in batches on an L2 (i.e., off of the Ethereum mainnet), and then a smaller amount of data is sent back to Ethereum. This practice vastly increases throughput, and, as the state of the rollup can be recreated and verified using the data posted on the Ethereum mainnet, rollups inherit many of the security properties of the mainnet itself. This strategy was a shift in Ethereum’s scaling roadmap proposed by Vitalik Buterin in 2020, dubbed the rollup-centric roadmap, which prioritized outsourcing execution to rollups and bolstering Ethereum’s data availability layer to reduce the cost of posting data back to the mainnet. In short, it shifted the focus of the Ethereum mainnet to consensus, settlement and data availability.(GSR)With that as background, we can now view Ethereum’s declining mainnet transaction count in a different light. And when adding in L2 transactions, we see that total Ethereum ecosystem transactions, including both those on the mainnet and its associated layer 2s, are up a strong 146% over the last two years. Not only does this show that usage of Ethereum continues to rapidly increase, but also it shows that it continues to progress along its roadmap exactly as intended.#CPI

In a thought-provoking social media thread on platform X (formerly known as Twitter) on 10 February 2024, Paul Krugman dissected the current economic climate, suggesting that President Biden should openly celebrate recent economic successes. Krugman’s commentary sheds light on the complex interplay between economic data, public perception, and political partisanship.

Krugman, an eminent economist and distinguished professor born on 28 February 1953, has made significant strides in international economics and economic policy analysis. His career, adorned with decades of influential work, has profoundly impacted the economic landscape.

In 2008, Krugman’s exceptional contributions to understanding trade patterns and the geographic allocation of economic activities were honored with the Nobel Memorial Prize in Economic Sciences. His innovative work in introducing the “new trade theory” and “new economic geography” has been instrumental in reshaping our understanding of how international trade and economic activities are organized across different locations.

Krugman also enjoys a high profile as a columnist for The New York Times, where he explores a broad array of economic issues. His columns span topics from fiscal policies and international economics to broader macroeconomic trends, often reflecting his progressive views on economic policy issues.

As an author, Krugman has contributed to or edited more than 20 books, marking him as a prolific figure in economic literature. His academic influence is further evidenced by over 200 published scholarly articles, and his textbooks on economics are widely used in university courses around the globe. Krugman’s work has left an indelible impact on economic studies, underscoring his significant role in the field.

Krugman begins his thread on X by acknowledging the “extremely good” recent economic news, challenging the hesitancy among some Democratic consultants regarding whether President Biden should highlight these achievements. Contrary to the belief that such boasting might appear out of touch, Krugman argues that the public does indeed feel the positive impacts of the economy, as evidenced by the significant uptick in the Michigan consumer sentiment survey.

However, Krugman notes a discrepancy between the objective economic indicators and consumer sentiment, attributing this gap largely to political partisanship. He points out that Democrats have largely embraced the positive economic news, while Republicans’ perceptions are clouded by their political stance, often unwilling to acknowledge economic improvements under a Democratic presidency.

Krugman’s analysis extends to independents, whom he suggests are mostly aligned with either of the major political parties, despite their nominal independence. This alignment, he argues, contributes to the skewed perception of the economy, with a significant partisan effect observed particularly among Republicans. According to Krugman, Republicans rate the current economy as worse than during the Great Recession or the 1980 stagflation, highlighting the depth of partisan bias.

In his concluding remarks, Krugman encourages the Biden administration to confidently tout its economic achievements. He contends that the voices cautioning against celebrating these successes belong to individuals who are unlikely to support Democratic candidates regardless of the economic situation. Thus, Krugman’s message is clear: the administration should boast about the economic progress without fear of appearing out of touch, as the data supports a narrative of economic recovery and growth.

Recent economic news has been extremely good. But there's a strange meme among some D consultants that Biden shouldn't boast about it, because it seems out of touch — that people aren't feeling the good economy. But they are! 1/

— Paul Krugman (@paulkrugman) February 10, 2024

On 9 February, a day marked by the S&P 500 surpassing the 5,000 threshold for the first time, Scott Bessent, the CEO & CIO of Key Square Capital, provided his analysis on the state of the US stock market during an interview with Bloomberg TV. He attributed the market’s recent upswing to the anticipation of Donald Trump’s re-election and the expected continuation of his policies. Bessent’s commentary delves into the underlying factors driving the market’s behavior and offers predictions for future developments.

The Influence of Trump’s Policies on Market Sentiment

Reflecting on the market dynamics of 2016, Bessent draws comparisons to the current situation, noting how the prospect of Trump’s policy agenda has led to a bullish market outlook. He recalls, “The market experienced a downturn on the eve of the 2016 election but then surged in the following weeks,” emphasizing the market’s reactive optimism to the possibility of Trump’s win in 2024. The optimism is largely fueled by expectations related to tax policies, deregulation, energy autonomy, and a more stable global political environment under Trump.

Expectations of Tax Policy and Deregulation

Bessent identifies the anticipation of Trump’s tax cuts, which are due to expire in 2025, being renewed and possibly expanded as a pivotal factor in the rally. He cites “Deregulation and energy autonomy” as central to Trump’s appealing market policies. This forward-looking sentiment lays the groundwork for a pro-market climate, contingent on Trump’s electoral success.

Strategies on International Trade and Tariffs

Discussing Trump’s approach to tariffs and international trade, Bessent presents a sophisticated perspective, suggesting that the threat of tariffs serves more as a bargaining tool than a policy destined for implementation. He believes, “The strategy involves placing the threat on the table without the intention to execute it,” reflecting a calculated method to enhance the United States’ negotiating power.

The Federal Reserve’s Political Influence

Bessent comments on the Federal Reserve’s role, implying that its decisions are somewhat influenced by political considerations. He notes a historical trend where, “Since 1952, there hasn’t been a year of market decline during an incumbent’s campaign,” suggesting a deliberate effort to maintain market stability through strategic liquidity injections and policy initiatives.

The Impact of Political Polls on Market Dynamics

A notable point in Bessent’s analysis is the relationship between Trump’s popularity in polls and the stock market’s performance. He observes, “As Trump advances in the polls, the market similarly sees gains,” supporting this claim with data indicating a 35% market increase during periods of Trump’s polling ascendance, in stark contrast to a modest 3% increase when Biden leads.

In a post on X on January 14, Krugman shared his insights into the latest U.S. economic data, focusing on inflation rates.

Krugman’s conversation with a concerned businessman about the persisting inflation rate of 3.9% led him to present a series of numbers to contextualize the situation. He referenced the U.S. Core Consumer Price Index (CPI), which measures the changes in the price of goods and services, excluding food and energy. The Core CPI over the last 12 months stood at 3.9%, but more importantly, over the last six months, it was at 3.2%. This indicates a slight decrease in the rate of inflation recently.

Further dissecting the data, Krugman highlighted the Core CPI excluding shelter costs (which have their own legacy issues) over the last six months, which was only 1.6%. This significantly lower figure suggests that when removing the impact of shelter costs, the inflation rate is considerably less severe.

Additionally, Krugman pointed to market expectations, which predict the CPI for 2024 to be around 2.3%. This forward-looking estimate indicates that market participants expect inflation to continue to decrease.

From these observations, Krugman concluded that “inflation has been defeated,” implying that the recent higher rates of inflation are being brought under control in the U.S. and are expected to normalize.

Talked with a smart businessman worried because inflation is still 3.9%. Gah. Some numbers:Core CPI, 12m: 3.9Core CPI, last 6m: 3.2Core CPI ex-shelter (which has legacy issues), 6m: 1.6Market expectations of CPI for 2024: 2.3Inflation has been defeated.

— Paul Krugman (@paulkrugman) January 14, 2024

Should Paul Krugman’s assertion that the United States has successfully tackled inflation hold true, it might herald significant shifts in the Federal Reserve’s approach to monetary policy, which in turn could affect risk assets such as cryptocurrencies and stocks.

Federal Reserve Policy Implications:

Adjustment in Monetary Policy Strategy: With the primary strategy of combating inflation through interest rate hikes, the Federal Reserve might shift gears if inflation shows signs of subsiding. This shift could transition from an aggressive policy of increasing rates to a more lenient approach, either by reducing rates or maintaining them at current levels.

Decision Timing: The Federal Reserve’s decision to adjust its monetary policy will hinge on concrete signs of sustained inflation reduction and overall economic stability. Such decisions are typically based on observing trends over a few months. A continued decline in inflation might prompt an earlier than expected policy adjustment.

Effects on Risk Assets:

Enhanced Appeal of Risk Assets: The attractiveness of risk assets could surge if the Federal Reserve signals a move towards lower interest rates. This shift would potentially lower borrowing costs and inject liquidity into the market, making riskier investments more appealing for those chasing higher returns.

Stimulation of Stocks and Cryptocurrencies: A move towards lower interest rates could invigorate markets for stocks and cryptocurrencies, which are often seen as risk assets. Such environments encourage capital inflow in search of greater yields, potentially elevating prices in these sectors.

Shift in Inflation Hedge Perception: Cryptocurrencies, especially Bitcoin, have been viewed as safeguards against inflation. A reduction in inflation concerns could diminish this aspect of their value proposition. Nonetheless, factors like technological innovation and increased adoption may still fuel interest in these assets.

Market Sentiment Overview:

Bolstered Investor Confidence: A change in Federal Reserve policy driven by effective inflation control could boost investor confidence and foster a positive outlook on the market, encouraging investment and economic expansion.

Prudence Advised: Investors should proceed with caution during the transition period, as shifts from rate increases to decreases can introduce market volatility. Additionally, external economic influences could impact market trends.

Featured Image via Pixabay

In a recent post on social media platform X, Paul Krugman shared his insights into the latest U.S. economic data, focusing on inflation rates.

Krugman is an American economist, distinguished professor, and author, known for his work in international economics and his commentary on economic policy. Born on February 28, 1953, Krugman has been a prominent figure in the field of economics for several decades.

He won the Nobel Memorial Prize in Economic Sciences in 2008 for his analysis of trade patterns and location of economic activity. Krugman’s work in this area, particularly his development of the “new trade theory” and “new economic geography,” has been influential in shaping understanding of international trade and economic geography.

In addition to his academic work, Krugman is also well-known as a columnist for The New York Times, where he writes on a wide range of economic issues including fiscal policy, international economics, and macroeconomic trends. His columns and books often discuss contemporary economic policy issues, and he is known for his liberal viewpoints.

Krugman has authored or edited over 20 books and has published more than 200 scholarly articles. His textbooks on economics are widely used in universities around the world.

Krugman’s conversation with a concerned businessman about the persisting inflation rate of 3.9% led him to present a series of numbers to contextualize the situation. He referenced the U.S. Core Consumer Price Index (CPI), which measures the changes in the price of goods and services, excluding food and energy. The Core CPI over the last 12 months stood at 3.9%, but more importantly, over the last six months, it was at 3.2%. This indicates a slight decrease in the rate of inflation recently.

Further dissecting the data, Krugman highlighted the Core CPI excluding shelter costs (which have their own legacy issues) over the last six months, which was only 1.6%. This significantly lower figure suggests that when removing the impact of shelter costs, the inflation rate is considerably less severe.

Additionally, Krugman pointed to market expectations, which predict the CPI for 2024 to be around 2.3%. This forward-looking estimate indicates that market participants expect inflation to continue to decrease.

From these observations, Krugman concluded that “inflation has been defeated,” implying that the recent higher rates of inflation are being brought under control in the U.S. and are expected to normalize.

Talked with a smart businessman worried because inflation is still 3.9%. Gah. Some numbers:Core CPI, 12m: 3.9Core CPI, last 6m: 3.2Core CPI ex-shelter (which has legacy issues), 6m: 1.6Market expectations of CPI for 2024: 2.3Inflation has been defeated.

— Paul Krugman (@paulkrugman) January 14, 2024

If Paul Krugman’s assessment that U.S. inflation has been “defeated” is accurate, it could have significant implications for the Federal Reserve’s monetary policy and, consequently, for risk assets like cryptocurrencies and stocks.

Implications for the Federal Reserve’s Policy:

Potential Pivot in Monetary Policy: The Federal Reserve has been raising interest rates as a primary tool to combat high inflation. If inflation is indeed subsiding, the Fed might consider slowing down or halting its rate hikes. This could lead to a pivot from a tightening monetary policy (rate hikes) to a more accommodative stance (rate cuts or holding rates steady).

Timing of the Pivot: The timing of this potential pivot would depend on sustained evidence of declining inflation and stability in other economic indicators. The Fed typically looks for consistent patterns over several months to make such decisions. If inflation rates continue to decrease, the pivot could happen sooner than anticipated.

Impact on Risk Assets:

Increased Attractiveness of Risk Assets: Higher interest rates generally make risk assets less attractive, as they increase the cost of borrowing and reduce liquidity in the market. A pivot from the Fed, indicating lower interest rates, could make these assets more appealing. Investors might return to riskier investments, seeking higher returns.

Boost in Stock Market and Cryptocurrencies: Stocks and cryptocurrencies, often considered risk assets, could see a boost in prices. Lower interest rates can lead to more capital flowing into these markets, as investors seek higher yields than what is offered by safer assets like bonds.

Reduced Appeal as Inflation Hedges: Part of the appeal of cryptocurrencies, particularly Bitcoin, has been their perceived role as a hedge against inflation. If inflation concerns diminish, this aspect of their appeal might lessen. However, other factors, such as technological advancements and broader adoption, could continue to drive interest in cryptocurrencies.

Overall Market Sentiment:

Increased Investor Confidence: A pivot from the Fed due to controlled inflation could lead to increased investor confidence and a more optimistic market outlook. This could stimulate investment and spending, contributing to economic growth.

Need for Caution: However, investors would still need to be cautious. The transition from rate hikes to cuts can lead to market volatility, and other global economic factors could also influence market dynamics.

According to a CNBC report published on January 3, 2024, the Federal Reserve’s December meeting minutes revealed that officials anticipate interest rate cuts in 2024. However, the exact timing of these cuts remains uncertain. The Federal Open Market Committee, during the meeting, maintained the benchmark rate between 5.25% and 5.5%, with projections of three quarter-percentage point reductions by the end of 2024.

CNBC highlighted the Fed’s acknowledgment of the high uncertainty surrounding future policy changes. The minutes indicated that while the policy rate is likely at its peak for the current tightening cycle, any adjustments would depend on the evolving economic landscape.

The report by CNBC also noted the Fed’s recognition of progress in combating inflation. Supply chain issues, a major contributor to the mid-2022 inflation surge, have reportedly eased. Additionally, efforts to balance the labor market are underway, though this remains an ongoing process.

CNBC’s coverage of the Fed’s “dot plot” – individual members’ expectations – suggested a consensus for rate cuts over the next three years, aiming to bring the overnight borrowing rate closer to the long-run range of 2%. This aligns with the improvements in inflation outlooks shared by almost all participants.

However, CNBC underscored the Fed’s caution, citing the minutes’ mention of an “unusually elevated degree of uncertainty” in policy direction. Some members expressed the need to maintain higher rates if inflation persists, while others didn’t rule out further hikes depending on future conditions.

CNBC also reported the Fed’s emphasis on a data-dependent approach to monetary policy, stressing the importance of a restrictive stance until inflation sustainably decreases. Despite this cautious stance, market expectations, as per Fed funds futures trading, lean towards more aggressive cuts, potentially lowering the fed funds rate to between 3.75%-4%.

Richmond Fed President Thomas Barkin, as reported by CNBC, echoed this caution, highlighting the risks in steering the economy towards a soft landing. The minutes acknowledged “clear progress” against inflation, with some measures even dipping below the Fed’s 2% target, but also noted uneven progress across different sectors.

Finally, CNBC mentioned the Fed’s ongoing efforts to reduce bond holdings, with approximately $1.2 trillion already shaved off. Discussions about concluding this process are expected to start well in advance, ensuring public awareness.

Featured Image via OxfordUnion

1. IntroductionCryptocurrencies, as a dynamic component of the global financial landscape, interact with traditional economic indicators, such as the Consumer Price Index (CPI). This exploration delves into the intricate relationship between CPI announcements, cryptocurrency markets, and the broader economic landscape.2. Higher-than-Expected Inflation: Catalyst for Cryptocurrency DemandWhen the Consumer Price Index signals higher-than-expected inflation, investors often seek refuge in alternative assets, with cryptocurrencies, particularly Bitcoin, emerging as a notable choice. This section explores the rationale behind this behavior and the characteristics of cryptocurrencies that position them as potential hedges against inflation and stores of value.3. Impact on Cryptocurrency Markets: Volatility and Price MovementsThe increased demand for digital assets in response to higher inflation concerns contributes to heightened volatility in cryptocurrency markets. This section examines how trading volumes and price fluctuations amplify, creating an environment where investors experience both substantial gains and losses within short time frames.4. Lower-than-Expected Inflation: Shifting Dynamics in Investor PreferencesConversely, when CPI figures come in lower than anticipated, indicating a more stable economic environment with reduced inflation risks, the dynamics shift. Investors may opt for traditional assets like stocks and bonds, leading to reduced demand for cryptocurrencies. This section explores the impact on cryptocurrency markets, resulting in lower prices and increased volatility in the downward direction.5. The Multifaceted Nature of Cryptocurrency Markets:#cpi announcements are just one facet of the complex puzzle that shapes the cryptocurrency landscape. This section delves into other influential factors such as regulatory developments, technological advancements, market sentiment, and broader economic conditions. It emphasizes the need for a comprehensive understanding to navigate the evolving terrain of cryptocurrency investments.6. The Regulatory Influence: Clarity and AmbiguityRegulation holds a significant sway over the cryptocurrency space. This section discusses how regulatory developments, whether positive or restrictive, can impact investor confidence, market behaviors, and overall sentiments in the cryptocurrency market.7. Technological Advancements: Shaping Perceptions and Market DynamicsTechnological innovations, particularly in blockchain technology, play a crucial role in shaping the cryptocurrency landscape. This section explores how upgrades to blockchain networks, developments in decentralized finance (DeFi), and non-fungible tokens (NFTs) contribute to evolving narratives and influence investor perceptions.8. Market Sentiment: The Power of PerceptionMarket sentiment, driven by news, social media, and broader economic narratives, is a potent force in cryptocurrency markets. This section examines how positive or negative sentiments, triggered by media coverage or regulatory announcements, can create a self-fulfilling prophecy, influencing investor decisions and market movements.9. Global Economic Conditions: Beyond CPI IndicatorsBeyond inflationary pressures captured by the CPI, global economic conditions play a vital role. This section discusses how economic downturns or uncertainties can drive investors towards safe-haven assets, including cryptocurrencies, and how periods of economic stability may lead to a preference for traditional assets.10. The Need for a Holistic PerspectiveThe maturation of the cryptocurrency market, marked by increased institutional participation and regulatory scrutiny, requires a holistic perspective. This section concludes by emphasizing the importance of continually reassessing the landscape, staying informed about developments, and recognizing the interplay of diverse factors when navigating the dynamic and evolving space of cryptocurrency investments.11. The Interconnectedness of Cryptocurrency and Traditional MarketsAs the cryptocurrency market continues to mature, its integration into the broader financial ecosystem becomes more apparent. This section explores the evolving correlations between cryptocurrency prices and traditional asset classes, indicating a shift in the significance of economic indicators like the CPI.12. Adapting to Change: Navigating a Stabilizing LandscapeThe evolution of cryptocurrency markets and their integration into traditional financial markets necessitate constant adaptation. This section discusses how staying abreast of developments, recognizing the impact of diverse factors, and adapting to changes in market dynamics are crucial for investors and traders navigating this complex and evolving landscape.13. Conclusion: The Nuanced Landscape of Cryptocurrency InvestmentsIn conclusion, the relationship between CPI announcements, cryptocurrency markets, and overall market sentiments is intricate and multi-faceted. This section summarizes the key insights, emphasizing that while the CPI serves as a barometer of inflationary pressures, the broader cryptocurrency landscape is shaped by a complex interplay of regulatory, technological, and economic factors.14. Future Considerations: Evolving Trends and Emerging FactorsLooking ahead, this section briefly explores potential future trends and emerging factors that could further shape the cryptocurrency landscape. From advancements in technology to evolving regulatory frameworks, understanding these potential shifts is essential for those navigating the dynamic world of cryptocurrency investments.15. Acknowledging Uncertainties: Risk Management in Cryptocurrency InvestmentsGiven the inherent volatility and uncertainties in the cryptocurrency market, effective risk management is paramount. This section discusses the importance of adopting sound risk management strategies, including diversification, staying informed, and understanding the unique risk profile of the cryptocurrency market.16. The Continuing Evolution: Cryptocurrency's Role in FinanceThe concluding section reflects on the continuing evolution of cryptocurrencies and their role in the broader financial landscape. It emphasizes the need for ongoing research, adaptability, and a forward-looking approach as the cryptocurrency market continues to mature and integrate into traditional financial systems.In essence, the intricate interplay between #CPI announcements, cryptocurrency markets, and broader economic factors highlights the nuanced nature of contemporary financial landscapes. Navigating this complexity requires a comprehensive understanding of various elements, from economic indicators to technological innovations and regulatory developments. As cryptocurrencies continue to evolve, staying informed and adopting a holistic perspective will be key to successfully engaging with this dynamic and transformative sector.

Bitcoin experienced a rollercoaster ride on April 10 as the U.S. Consumer Price Index (CPI) data for March was released. The CPI, which measures the average change in prices paid by urban consumers for goods and services, came in at 3.5% year-on-year, slightly above the expected 3.4% and the previous month’s 3.2%.

TLDR

Bitcoin price rebounded to $69,000 on April 10 after initially dipping to local lows of $67,482 following the release of the U.S. Consumer Price Index (CPI) data for March.

The CPI came in slightly above expectations at 3.5% year-on-year, causing concerns about the Fed’s rate cut trajectory and sparking a brief dip in Bitcoin’s price.

Whale buyers on Binance took advantage of the dip to accumulate more Bitcoin, helping the price recover to around $69,100.

The two largest U.S. spot Bitcoin ETFs from BlackRock and Fidelity Investments saw modest inflows on April 9, continuing their unbroken streak of net inflows.

Despite the initial dip, some analysts believe that the higher-than-expected CPI numbers might be favorable for Bitcoin in the long term,

The higher-than-anticipated inflation numbers sparked concerns among investors about the Federal Reserve’s rate cut trajectory. The data suggested that interest rates might remain higher for longer than previously expected, as the Fed’s target inflation rate of 2% remains elusive. This initially caused a dip in Bitcoin’s price, which fell to local lows of $67,482 on the Bitstamp exchange.

Bitcoin Price at Coingecko

However, the dip proved to be short-lived, as whale buyers on the Binance exchange seized the opportunity to accumulate more Bitcoin at a discounted price. Data from trading resource Material Indicators revealed that “purple whales” bought the dip, helping to propel the price back up to around $69,100, close to its daily opening level.

#FireCharts binned CVD shows that purple whales bought the #BTC dip.

Did you?

Stop Trading Blind. Get FireCharts Now! https://t.co/z8VpL3p88E pic.twitter.com/Mf5RH7plzw

— Material Indicators (@MI_Algos) April 10, 2024

The recovery in Bitcoin’s price was further supported by the continued inflows into the two largest U.S. spot Bitcoin exchange-traded funds (ETFs) from BlackRock and Fidelity Investments. These ETFs saw modest inflows on April 9, maintaining their unbroken streak of net inflows and demonstrating ongoing institutional interest in the cryptocurrency.

Despite the initial dip, some analysts believe that the higher-than-expected CPI numbers might actually be favorable for Bitcoin in the long term. Darren Franceschini, co-founder of Fideum, argues that Bitcoin’s limited supply and reputation as a hedge against inflation make it an attractive option for investors navigating the uncertainties of rising prices.

The upcoming Bitcoin halving event, which is expected to occur in May 2024, is seen as a potential catalyst for increased interest and speculation in the cryptocurrency. The halving, which occurs approximately every four years, reduces the amount of new Bitcoin entering circulation by half, thus increasing its scarcity and potentially driving up its price.

As Bitcoin continues to trade within a tight price range between its previous all-time high of $69,000 and resistance at $71,300, some traders, such as Rekt Capital, believe that there may only be a few “bargain-buying opportunities” left before the cryptocurrency breaks through its resistance and enters price discovery territory.

#BTC

There are only two bargain-buying opportunities left for Bitcoin before price takes-out into Price Discovery

There's the Pre-Halving Retrace (dark blue circle)

And then there's the Re-Accumulation phase (red)

Bitcoin has already experienced a Pre-Halving Retrace of -18%… pic.twitter.com/OBkdTyMFr8

— Rekt Capital (@rektcapital) April 8, 2024

The resilience of Bitcoin’s price in the face of the higher-than-expected CPI numbers demonstrates the growing maturity and stability of the cryptocurrency market.

As more institutional investors and mainstream adoption continue to drive demand for Bitcoin, its ability to weather short-term volatility and macroeconomic uncertainties is likely to improve.

As the global economic landscape continues to evolve and central banks grapple with the challenges of inflation and monetary policy, Bitcoin’s role as a hedge against inflation and a store of value is likely to remain a topic of intense interest and debate.

The cryptocurrency’s performance in the coming months, particularly in the lead-up to and aftermath of the halving event, will be closely watched by investors and analysts alike.

The post Inflation Hedge? Bitcoin Bounces Back Above $70k After US CPI Numbers Exceed Expectations appeared first on Blockonomi.

Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our  website policy prior to making financial decisions.

The US dollar index fell by roughly 1% on Tuesday following cooler-than-expected inflation data for October. The annual inflation rate of 3.2% was lower than economists’ projections and marked a notable drop from September’s 3.7%. The report acted as a catalyst for US equities, with all major indices seeing noteworthy gains at the opening bell. 

Core CPI Lowest in Two Years

The most recent Consumer Price Index (CPI) report for October released on Tuesday offered a promising signal for the US economy, with inflation remaining flat compared to the previous month.

Notably, the annual inflation rate stood at 3.2% last month, below the consensus estimates of 3.3% and significantly lower than the 3.7% reported for September. Month-on-month, the CPI showed no change, indicating a flat inflation rate. This contrasts with the 0.4% increase observed in September.

Excluding volatile food and energy prices, core CPI increased by 0.2% in October, slightly below the forecasted 0.3%. The annual core CPI, stood at 4%, marking the lowest level in two years, although it is still well above the Federal Reserve’s 2% target.

In terms of the market’s reaction, it was largely as expected. The US dollar index fell nearly 1% to 104.64, the lowest in almost two months. The yield on the 10-year Treasury fell by 0.18 to 4.44%, while the 30-year yield slipped 0.13 to 4.61%.

Stocks soared higher at the opening bell, with the S&P 500 adding 1.44%, Dow Jones climbing 1.1%, and the tech-oriented Nasdaq-100 advancing over 1.6%. 

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Can the US Economy Stage a ‘Soft Landing?’

The latest CPI data came as markets closely monitor the Fed’s next steps in a 1.5-year battle against inflation. Since March 2022, the US central bank raised the key borrowing rate 11 times to the highest level since early 2001. 

Although markets hoped for a halt in monetary policy tightening, late data presented conflicting signals. 

October’s nonfarm payrolls rose by a modest 150,000, suggesting the labor market is responding to the Fed’s efforts to address supply-demand imbalances fueling inflation. Also, labor costs have grown more slowly amid increased productivity over the past 18 months. 

Meanwhile, the gross domestic product (GDP) surged at a 4.9% annualized pace in Q3, but economists anticipate a considerable slowdown in the growth rate. On the other hand, different indicators show that consumer inflation expectations are still rising, likely resulting from increased gas prices and uncertainty caused by the wars in Ukraine and Gaza.

At the same time, the possibility of rate cuts in 2024 persists. This, coupled with the prevailing optimism that the US will sidestep a recession, paints a narrative of a potential soft landing for the economy.

Do you think the Federal Reserve will begin cutting rates next year? Also, is the US recession still avoidable, in your opinion? Let us know in the comments below. 

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