Monday, June 5, 2023

Bitcoin Approaching $27,000 Level Despite PCE Data Sparking Rate Hike Bets in June

Bitcoin ignores new US inflation problems.

Data from Cointelegraph Pro Forums and TradingView showed that the BTC/USD pair is nearing $27,000 on Bitstamp.

The pair unexpectedly rose after Personal Consumption Expenditure (PCE) data showed gains for the first day since October 2022.

Such a lesson should extend to risky assets, including crypto-currencies, which entails persistent inflation and the need for further monetary control to curb it.

“It’s a huge disadvantage for H’s fight against inflation” he wrote in part a response to the financial aid essay The Kobeissi Letter.

Kobeissi noted that expectations of user hikes by the Federal Reserve will “change quickly” thanks to the PCE event.

According to CME’s FedWatch Group tool, the market is now narrowly leaning in favor of a further June deal, while previously more than 80% would have achieved some kind of delay.

H target rate probability chart. Source: CME Group

For his part, economic commentator Tedtalksmacro acknowledged that PCE gains are relative.

“US PCE data beat analysts’ expectations. However, on a 3-month annualized basis, core PCE fell sharply…to 4.2%”; comment.

News that the Biden administration would reach a debt ceiling deal, days away from the deadline, was a relief to traders.

The S&P D Index and the Nasdaq Composite Index were up 1% and 1.65%, respectively, at the time of writing.

DXY hit 10-week highs

That Bitcoin itself, Michael van de Poppe, founder and CEO of the trading firm Octo, highlights the power of excitement.

“That’s the first step for Bitcoin as it recaps $26,600 and looks for a continuation towards the highs.” comment worth the activity of the day.

“If there is a correction of the recent decline, we could go up to $29,000 next week.” Annotated chart of the BTC/USD pair. Source: Michaël van de Poppe

He warned that PCE was not a “great signal” for risk assets, pointing to a knee-jerk reaction to the strength in the US dollar, traditionally correlated inversely with cryptocurrencies.

The US dollar index (DXY) hit 104.4 points on the day, the highest level since March 17.

“Some consolidation after this month’s rally would be healthy for the dollar,” popular trader Justin Bennett wrote in a detailed forecast.

But the daily and next week opens above 104.20 and 105.00 early next week. The only thing that will turn me bearish on DXY is the daily close below 103.50″. US Dollar Index (DXY) 1-candlestick today chart. Source: TradingView

Bitcoin (BTC) rallied at the open on Wall Street on May 26, when disappointing economic data from the United States was released.

This article does not contain investment advice or recommendations. All investments and trades carry risks, so readers should do their own research when making decisions.

Research into crypto assets is not regulated. They may be eligible for sales and all the money invested may be lost. The services or products offered are not directed at or accessible to investors in Spain.

Nation World News Desk
Nation World News Desk
Nation World News is the fastest emerging news website covering all the latest news, world’s top stories, science news entertainment sports cricket’s latest discoveries, new technology gadgets, politics news, and more.
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