Bitcoin experienced a pullback from its all-time high of $122,125 as market reactions followed the release of U.S. inflation data. Key factors driving Bitcoin’s rally included an influx of institutional capital into Bitcoin ETFs and optimism regarding U.S. monetary policy. The release of CPI data, with headline inflation at 2.7% instead of the expected 2.6%, introduced market caution. The current inflation signals suggest the Federal Reserve may take its time in deciding on rate adjustments. Increased volatility in the cryptocurrency market is anticipated, influenced by macroeconomic and technical variables.
Bitcoin has pulled back from its all-time high around $122,125, responding to macroeconomic signals, particularly U.S. inflation data that was higher than expected.
The strong rally of Bitcoin was primarily driven by institutional capital inflows into U.S. spot Bitcoin ETFs and expectations of easing U.S. monetary policy.
The CPI data indicating a headline inflation of 2.7%, versus the 2.6% forecast, has created temporary caution in market sentiment and implications for Fed policy.
Despite the market correction, there is no conclusive evidence that Bitcoin's uptrend has ended, though increased volatility in the cryptocurrency market is anticipated.
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