BTC Seeks $120K in Reclaim on CPI Print and Fed Rate Cut Chances

The key takeaways

• The July US CPI remained at 2.7% over the previous year, increasing Fed rate-cut bets for September to 93.9%.

• Price support for the key range is $117.650 to $115.650. If prices drop further, they could reach a CME price gap around $95,000.

BitcoinBTCAfter the July US Consumer Price Index, which indicates inflation holding The CPI was unchanged from the previous month, and fell below the forecast of 2,8%. The core CPI, which excludes food and energy from the calculation, increased by 3.1% on an annual basis, as expected. Overall CPI rose by 0.2% on a monthly level, down from 0.3%. Core CPI rose 0.3%, up from a previous 0.2%.

These data confirm a slight bullish outlook for Bitcoin. A cooling of inflation is good for risky assets, and a monetary stimulus can be seen as an important factor. Lower interest rates reduce the cost of Bitcoin holdings, which could attract new capital to the market. 

According to the Federal Reserve, following the release of CPI, expectations on a rate reduction in September jumped to 93.9%. CME FedWatchThe traders have priced in the likelihood that monetary policy will ease.

The in-line CPI core figure indicates that the Fed might still need more information before taking any action. 

Next week, the Producer Price Index (2.3% is estimated) and Core PPI (2.5%) could prove crucial. The softer than expected print may confirm the bullish macro-setup for Bitcoin. This would reinforce lower rates expectations, and boost demand for risky assets such as Bitcoin. 

Related: Bitcoin gets $95K target as ‘ugly’ BTC price candle spoils breakout

Bitcoin to Hit $130,000 In September?

After a weekend of bullish trading, Bitcoin reached Monday highs at $122,190. However, gains were brief as the price dropped 3%, to $118.500. It failed to close the day above $120,000.

BTC rallies to $119.500 after the US CPI is released. However, a close decisively above $119.982 will be needed to confirm immediate upward momentum. It would be an historic event if Bitcoin were to close the day above $120,000. This could spark the next leg in its rally.

Technically, the bullish pattern of the flag has recently broken to the upside on the chart. The pullback that we are experiencing could just be a retest, before continuing on to the main target of $130,000.

Titan of Crypto is a notable technical analyst projects A similar scenario is a bullish one, aiming for $137,000 on the basis of a trendline break seen Sunday.

In the short term, however, a failure to reach $120,000 will likely lead to downside pressure. Immediate support lies in the $117,650–$115,650 zone. This important support zone also coincides the CME gap created over the weekend. Traders should keep an eye on this area.

The following are some of the ways to get in touch with us. noted Cointelegraph reports that despite BTC’s higher position, it is still vulnerable to losing its $100,000 critical support. A deeper correction may even test as low as $95,000.

Related: Bitcoin will make history at $340K if BTC beats last cycle’s 2,100% gains

The article is not intended to provide investment advice. Risk is inherent in every investment decision and trade. The reader should always do research prior to making a final decision.