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Bitcoin Price Prediction: BTC Soars to $67,900; Mixed US Inflation Data & Fed Rate Cut Hopes Fuel Rally

Bitcoin Price Prediction

Bitcoin (BTC) continued its upward momentum, reaching around $67,900. The Federal Reserve’s preferred inflation measure, the Core PCE Price Index, increased by 0.2% month-over-month in April, aligning with expectations but slightly below the previous month’s 0.3% rise. This modest increase may ease some inflation concerns for the Fed, but consistent readings are necessary to support a potential rate cut by September.

The Chicago PMI dropped to 35.4, below the anticipated 41.1, indicating weaker manufacturing activity. These mixed data points suggest a complex economic outlook, with easing inflation but slowing economic activity, hence driving a bullish Bitcoin price prediction.

US Inflation Data and Potential Fed Rate Cut

Bitcoin (BTC) maintained its upward momentum, rising to around $67,900. The Federal Reserve’s preferred inflation measure, the Core PCE Price Index, rose 0.2% month-over-month in April, meeting expectations but falling short of the previous month’s 0.3% rise.

The core PCE price index rose 0.25% in April (it rounded down to 0.2% because it was 0.249%)

Jan-March figures were revised down ever so slightly.

The 12-month change was 2.75%, a three-year low

The 6-month annualized rate was 3.18%, the highest since July

— Nick Timiraos (@NickTimiraos) May 31, 2024

This slight increase could alleviate some inflation concerns for the Fed, but consistent readings are needed to support a rate cut by September.

Core PCE Price Index m/m: 0.2% (expected 0.3%)
Chicago PMI: 35.4 (previous 37.9)

The Chicago PMI fell to 35.4, below expectations of 41.1, indicating weaker manufacturing activity. These data points suggest a mixed economic outlook, with inflation showing signs of easing while economic activity slows.

This data impacts Bitcoin price as the potential for a Fed rate cut by September becomes more likely if inflation continues to moderate, which could weaken the US dollar and support BTC price gains.

Disappointing US GDP Data Underpins Bitcoin Price

This increase in BTC price is also largely due to the weakening US dollar, which lost traction following disappointing US GDP data. The softer GDP figures prompted traders to anticipate a Federal Reserve rate cut this year, putting pressure on the dollar and boosting BTC.

Key Points:

Chicago Fed President Austan Goolsbee highlighted concerns over housing inflation and a robust labor market.
Atlanta Fed President Raphael Bostic suggested a rate cut in July is unlikely due to slow inflation progress.
New York Fed President John Williams is optimistic that inflation will ease later this year.

US economic data revealed that GDP grew at an annualized rate of 1.3% in Q1, down from the previous 1.6% but in line with expectations.

Additionally, US weekly Initial Jobless Claims rose slightly to 219K, above the market consensus of 218K. These factors, combined with the anticipation of a Fed rate cut, have bolstered Bitcoin’s appeal.

Bitcoin Price Volatility Influenced by Mixed Sentiments in Spot Bitcoin ETF Market

The Spot Bitcoin ETF market exhibited mixed investor sentiments on May 30, 2024, with total investments amounting to $48.71 million.

Notably, Blackrock’s iShares experienced a modest inflow of $2 million, while Fidelity saw a significant $119 million inflow, underscoring strong investor trust. Bitwise also attracted $26 million, indicating growing confidence in its offerings.

Key Points:

Blackrock’s iShares: $2 million inflow
Fidelity: $119 million inflow
Bitwise: $26 million inflow
ArkShares: $100 million withdrawal
Invesco: $2 million inflow

However, ArkShares faced a substantial $100 million withdrawal, suggesting potential shifts in investor sentiment. Invesco maintained steady interest with a $2 million inflow.

Meanwhile, WisdomTree, Grayscale, Franklin, Valkyrie, and VanEck saw no new investments, likely due to competitive pressures and evolving investor preferences.

These mixed investment flows in the Spot Bitcoin ETF market signal varied investor sentiment, which could lead to increased BTC price volatility. Strong inflows boost market confidence, while significant withdrawals create uncertainty, influencing Bitcoin’s price dynamics.

Bitcoin (BTC/USD) Technical Outlook: June 1, 2024

Bitcoin (BTC/USD) is currently trading at approximately $67,900, marking a slight increase of around 0.25%.

The pivot point, marked in green, is set at $68,100 and serves as a critical indicator for potential market direction. Immediate resistance levels are positioned at $68,800, $69,800, and $70,600.

#Bitcoin Technical Outlook: June 1, 2024
Key levels to watch:
Pivot Point: $68,100
Resistance: $68,800, $69,800, $70,600
Support: $67,500, $66,600, $65,900
Will BTC break above $68,800 for a bullish run or dip below $67,500? Stay tuned! #Crypto #BitcoinAnalysis

— Arslan Ali (@forex_arslan) June 1, 2024

On the downside, immediate support can be found at $67,500, with further support at $66,600 and $65,900.

Technical indicators show the Relative Strength Index (RSI) at 46.94, suggesting a neutral to bearish sentiment.

Bitcoin Price Prediction – Source: Tradingview

Additionally, the 50-day Exponential Moving Average (EMA) is aligned with the pivot point at $68,100, indicating this level as a significant dynamic support.

The outlook for Bitcoin remains bearish below the pivot point of $68,100. A breach below the immediate support at $67,500 could drive further declines, while a break above $68,800 may shift the sentiment towards a bullish bias, targeting higher resistance levels.

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