Bitcoin approached $58,000 around the Wall Street open on July 12 as markets reacted to the latest U.S. inflation data.
Cointelegraph Markets Pro and TradingView data indicated that Bitcoin’s price improved as the Producer Price Index (PPI) for June exceeded expectations.
The year-on-year PPI was 2.6%, higher than the forecasted 2.3% and 0.1% above the previous month.
“On an unadjusted basis, the index for final demand rose 2.6 percent for the 12 months ended in June, the largest advance since moving up 2.7 percent for the 12 months ended March 2023,” the U.S. Bureau of Labor Statistics reported.
Despite contrasting with the Consumer Price Index (CPI) numbers from July 11, BTC/USD avoided a decline after the PPI release.
Instead, it saw modest gains alongside U.S. stocks, while the dollar weakened.
“So overall PPI is sticky on YoY basis if not higher due to higher prices & lack of supply,” popular trader Skew remarked on X (formerly Twitter). “Increasing energy, food and trade services prices is not a great look.”
Skew pointed out that excluding energy, food, and trade services, the index was “basically flat” and less surprising to markets.
“Initial reaction was DXY & Yields up before lower, this tells me the market is transitioning into expecting a harsh reality when demand continues to buckle,” he concluded.
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“NQ & ES likely recovering here with hedges coming off. End of day performance will be important.”
The U.S. Dollar Index (DXY) dropped 0.35% on July 12, nearing its lowest levels in over a month.
Skew also described Binance’s spot order book as “pretty healthy.” “Although orderbooks are skew to bid, need to see this translate into market flows being bid,” he noted alongside a liquidity chart.
Other traders called for a stronger move from BTC/USD to signal a longer-term recovery. Popular trader Rekt Capital identified $58,350 as a crucial level for the daily close.
“There’s the rebound Bitcoin needed and price is now challenging that Lower High resistance again,” he informed his X followers, highlighting the PPI reaction with a chart.
“Bitcoin needs to Daily Close above $58350 (black) to break the Lower High and more importantly – position itself for a rally to $60600 (blue).”
Rekt Capital reiterated that BTC/USD had been attempting to break through a downward trendline but faced rejection in recent days.
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