The crypto market turned bullish on Wednesday after the United States Bureau of Labor Statistics released the fifth CPI data of 2023, which was lower than expected. According to the announcement, the United States Consumer Price Index (CPI), which tracks the change in the price of goods and services purchased by consumers, dropped by 0.1 basis from last month to 4.9 percent. The lower-than-expected CPI data was hawkish for the United States dollar index, which dropped by about 0.25 percent to around 101.395.
The announcement was also bullish for the market equities that edged higher after the CPI data on Wednesday. For instance, the US 100 NDQ Index, which tracks the top 100 largest non-financial companies listed on the Nasdaq stock exchange, edged 1.23 percent higher after the CPI announcement on Wednesday.
CPI Data Effects on Crypto Market
The crypto market was mostly calm before the CPI data as traders eagerly awaited the release. Following weaker US dollar effects, crypto traders turned bullish on digital assets, with Bitcoin price topping $28k. According to the latest market data, Bitcoin price gained as much as 2.5 percent to hit a 24-hour high of around $28,251.
Similar gains were recorded on Ethereum (ETH) which traded around $1,877 on Wednesday. Notably, the total crypto market capitalization was up about 1.6 percent to stand around $1.21 trillion.
Bearish Sentiments
As the Fed fights to bring down inflation to around 2 percent, crypto analyst Michael van de Poppe expects the Bitcoin market to enter a choppy season.
Ultimately, the YoY is great as it’s lower than expected.
The MoM data is worse than expected and shows that inflation remains sticky.
End status; we’ll be having a prolonged period with it and neutral data.
Chop season it is for #Bitcoin.
— Michaël van de Poppe (@CryptoMichNL) May 10, 2023
Similar sentiments were shared by crypto trader Altcoin Sherpa, who insisted that Bitcoin price does not have enough fuel to rally beyond $29k due to intermediate resistance levels.
$BTC: I dont think that this goes past 29k in the short term; lots of resistance coming. 4h EMAs all clustered + lots of S/R levels incoming, this is still a v. choppy environment IMO. #Bitcoin pic.twitter.com/KHl76kwlYP
— Altcoin Sherpa (@AltcoinSherpa) May 10, 2023
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