Bitcoin News: CME Group Analysts Hint at $70k BTC Price Rally after US CPI

Bitcoin Price Analysis:

Bitcoin price hit a 23-day low of $58,901 on Oct 10, down 8.5% in the last 3-days, historical data suggests the latest US CPI report could spark instant BTC rebound.

Bitcoin Price Wobbles Below $60k as CME Group Hints at another Fed Rate Cut

Bitcoin started October 2024 with strong momentum, buoyed by improving US macroeconomic conditions alongside other major risk assets. However, the bullish momentum weakened as market participants anticipated the release of the US inflation report on October 10.

On that day, the US Bureau of Labor Statistics reported a 2.4% increase in the Consumer Price Index (CPI) for September 2024, up from 314.80 points in August to 315.30 points. Core inflation, which excludes food and energy prices, stood at 3.3%.

What 2.4% US CPI Increases Means for BTC Price Action

The September CPI report indicates that the inflation crisis is in the rear view mirror, with few signs of price pressures reigniting. The figures in the chart above suggests the Fed is likely to cut rates again during the next FOMC meeting for 2 vital reasons.

Firstly, the 2.4% inflation growth comes in hotter that the 2.3% CPI forecast that many surveyed analysts had anticipated.

More so, it suggests that despite the 50 bps rate cut last month, the Fed is still some distance away from reaching target figures below 2%.

With inflation moderating, strategic investors anticipate an increase in demand for Bitcoin, potentially triggering a major bullish price reversal.

CME Group analysts have raised the probability of a Fed rate cut to 86.4%, following the CPI data released on October 10. This heightened expectation of a rate cut could further bolster Bitcoin’s appeal as a hedge against inflation.

As strategic investors digest these CPI figures, over the coming days, Bitcoin is expected to witness increased demand, potentially triggering a major bullish price trend reversal.

How Will Bitcoin React to September CPI?

Another Bitcoin Rebound Ahead: Despite the 50 bps rate cut last month, inflation in September came in hotter than expected, causing Bitcoin to dip below $60,000. However, as market expectations for another rate cut grow, demand for risk assets like Bitcoin is likely to increase in the coming weeks.

If this scenario materializes, Bitcoin could be on the verge of a significant rebound.

Notably, the BTCUSD chart above last two US CPI reports released on Aug 14 and Sept 11, respectively both propelled Bitcoin price into double-digit rallies.

As the USD weakens amid consecutive rate cuts, Bitcoin’s appeal as a store of value strengthens. Hence, with the hotter-than-expected inflation observed on Oct 10, this September US CPI report could potentially, trigger another BTC price rebound in the days ahead.

Bitcoin Price Forecast: $70k “Uptober” Rally Still Viable

CME group analysts have raised the likely-hood of Nov 7, Fed rate cut to 86.4% following the US CPI data release on Oct 1. Early reactions saw Bitcoin price fell to $58,901, its lowest in 23-days dating back to Sept 23.

However, drawing insights from similar inflation trends in the last 2 CPI reports, BTC price could be on the verge of another double-digit rally towards $70k ahead of the next FOMC meeting slated for Nov 7.

Technical indicators on the BTCUSD daily chart below also affirm this optimistic Bitcoin price outlook. Firstly, the Keltner Channel indicator shows Bitcoin recently touched the lower band at $57,980, a key support level.

Historically, when prices hit the lower band, a reversal toward the midline often follows. This suggests a rebound toward the mid-level resistance at $61,848 in the near term.

Meanwhile, the Choppiness Index (CHOP), currently at 46.50, signals consolidation, meaning a breakout is imminent. A sustained move below 38 on the CHOP scale would confirm a trending market, likely upward, as volatility decreases.

Further upside potential is evident, with the upper Keltner band sitting at $65,715. This could act as the next significant resistance if BTC maintains bullish momentum. A break above the $66,000 level would strengthen the case for a $70,000 rally as market sentiment improves, driven by macroeconomic tailwinds.