Bitcoin and wider market of cryptography were faced with a shock on January 12 after the latest data on the American consumer price index (ICC) arrived warmer than expected. The shock sent Bitcoin briefly downwards before bouncing, stimulating a range of reactions between traders and analysts.
The American Labor Statistics Bureau Figures released Showing an increase of 0.5% of one month to month of the IPC, placing annual inflation to 3.0% – in the previously expected 2.9%. Meanwhile, the basic ICC (excluding volatile food and energy costs) increased by 0.4% per month, regulating at an annual rate of 3.3% and also exceeding forecasts consensual.
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Shortly before the data was online, Bitcoin experienced a rapid drop from -2.1% to $ 94,250, which some speculant market observers could be linked to traders or initiates receiving an early suspicion of exceeding inflation. However, the slowdown proved to be temporary; The prices rebounded at peaks of $ 98,100 while the worried retail merchants have watched the market reaction unfold.
A “Buy the News” event for Bitcoin?
Santly, a chain analysis company, has weighed on volatility in a blog Dated February 13. In an update entitled “ICC attracting the attention of the crowd …”, Brian Quice, director of marketing at Santiment, noted that market players have become very sensitive to any new inflation, in particular given of the turmoil of recent years.
Citing a 15 -month summit in discussions related to the IPC on social networks like X, Reddit, Telegram, 4chan, BitcoinTalk and Farcaster, Santiment highlighted the extent of the apprehension of traders: “Initially, just before ‘Announcement of the CPI report, Bitcoin briefly lowering -2.1% to $ 94,250 before recovering slightly. This could very well have been great initiates who had a wind of inflation news in advance in advance. However, prices quickly recovered at $ 98,100 because sales were worried. »»
The post also explained that the shock of this version of the IPC has rekindled fears linked to changes in the federal reserve policy. After having reduced the rates of 2023 and 2024, the Fed suddenly interrupted other discounts in November 2024.
Santiment warns that this could point out an prolonged period without reductions in additional rate: “Now that the number of inflation is worrying in the United States, many predict that it will take long before seeing other cutswhich traditionally benefits markets. The rate increased in 2022, which was largely attributed to the correction of massive cryptography, are always fresh in people’s memories. “”
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Despite the prospect of Prolonged monetary tighteningSantiment has observed a signal with potential counter-current involving the counting of Bitcoin support: “We have already seen a drop in total holders on the Bitcoin network, and it is generally a bull signal. An ideal scenario would be that small traders were excessively to this news, allowing whales and sharks to collect more coins and send prices on the arrow. On the basis of the first prices rebounds following news, it can be announced as a scenario “Selling the rumor, buying the news scenario”.
Market observers beyond Santiment have also interlued. title and 40% of central inflation). This reading is massively late for almost a year. Nothing to fear, because more real readings show flat accommodation to fall on the major markets, ”he noted via X.
For many traders, the burning question remains: will this “hot” reading of the IPC mark the beginning of a new inflationary trend-or is it just a delayed bustry of data? The suggestion of santly of a possible dynamic “Selling the rumor, buying the news” reflects how quickly the feeling can change in a crypto market often motivated by momentum and social consensus. Meanwhile, the Dunleavy housing failure underlines that the number of inflation in phase can be misleading without dissecting the underlying components.
At the time of the press, BTC exchanged $ 96,028.
Star image created with dall.e, tradingView.com graphic
