The crypto world is buzzing with equal parts excitement and trepidation ahead of the US Consumer Price Index (CPI) being released today.
As we reported earlier this week, the CPI – the monthly report on inflation in the US – will be a huge bullish signal if the rates come down or a bearish signal if it goes up.
The key number is 8.3%, last month’s figure. Any reduction in that number will act as a buy signal for traders and investors as it will act as an indicator the Federal Reserve is controlling rising inflation.
A huge sell-off is expected should it come in above 8.3%.
The information will be released at 8.30am EST (12.30pm UTC / 1.30pm UK).
Traders Await CPI Data
Well respected crypto trader, and CEO and founder of trading firm Eight, Michaël van de Poppe summed up market sentiment on Thursday morning with a simple Tweet.
He wrote: “Markets selling off as fears go through the roof for CPI today. Maybe most hyped data point of the year.”
A number of Twitter traders and analysts have been sharing similar thoughts on the platform in the last 12 hours, with Ash WSB predicting an incoming “pump” if CPI is 8% or below and a “dump” if it is above 8.2%.
Many traders are expecting Bitcoin – currently trading below $19k – will rocket above $20k with good news, but dip to below $18k if bad.
Another major trader, IncomeSharks, wrote: August CPI was 8.3%. September CPI is expected to be 8.1%. That would be a small improvement which isn’t much but for markets and the headlines they can all scream ‘Inflation is cooling, the FED is doing such a great job.’
“Enough for me to expect a little rally.”
Markets selling off as fears go through the roof for CPI today.
Maybe most hyped data point of the year.
— Michaël van de Poppe (@CryptoMichNL) October 13, 2022
EXPECTED CPI IS 8.1% YoY
If we are 8% or lower = PUMP
If it comes to 8.2% or more= DUMP
— Ash WSB ⬢ (@Ashcryptoreal) October 13, 2022
CPI numbers coming up tomorrow.
If it’s good we might rally very temporarily and then eventually fall back to where we are.
If bad, more downside.
Either way markets looking to next Fed for pivot. Which won’t happen.#BearMarket
— John Wick (@ZeroHedge_) October 12, 2022
August CPI was 8.3%. September CPI is expected to be 8.1%. That would be a small improvement which isn't much but for markets and the headlines they can all scream "Inflation is cooling, the FED is doing such a great job". Enough for me to expect a little rally.
— IncomeSharks (@IncomeSharks) October 12, 2022
worse than expected – down
as expected – probably continue range
better than expected – up
Really don’t need to overcomplicate things and those accounts who keep tweeting about a short squeeze need to chill out and wait for the data.
— Ken (@Crypto__Ken) October 13, 2022
US CPI data Coming out Today at 8:30 AM EST..!!
— Captain Faibik (@CryptoFaibik) October 13, 2022
Bitcoin volatility has been extremely low in recent weeks and there is also a growing belief that the CPI announcement will finally spark BTC back into life.
Arcane Research analyst Vetle Lunde, in a post earlier this week, is expecting “explosive volatility” and a “leverage bonanza” in the coming days and weeks after a period of low volatility.
“I view the current open interest as well blown above any levels that may be assessed as sustainable, opaqueness from market signals restricts me from having any directional view on the winddown of said leverage.”
Lunde also added that “new highs will be met in a not too far distant future” with financial institutions such as Nasdaq, BlackRock and Citadel moving into the crypto industry.
World Economy Still Slow
Economists polled by Retuers forecast the CPI figure to be at 8.1%, below August’s rate of 8.3% – a figure that would initiate a pump in the crypto markets.
Despite the figure being good news for crypto traders and investors, the figure is still huge and will have ongoing effects on the US – and world – economy.
S&P 500 Utilities sector has eliminated all gains since March 2021; decline over past 20 days has amounted to -19%, which is worst stretch since pandemic-driven bear market in 2020
[Past performance is no guarantee of future results] pic.twitter.com/jQwfXX7ZBl
— Liz Ann Sonders (@LizAnnSonders) October 13, 2022
Federal Reserve governor Michelle Bowman warned of further rate hikes in the near future if inflation does not slow.
“If we do not see signs that inflation is moving down, my view continues to be that sizeable increases in the target range for the federal funds rate should remain on the table.
“However, if inflation starts to decline, I believe a slower pace of rate increases would be appropriate.”
Meanwhile, US stocks closed lower for a sixth consecutive day and the S&P 500 ended 0.3% down – a two-year low.
The Japanese Yen is back at 1998 levels and the Bank of England announced new measures to ensure an “orderly end” to its emergency bond buying scheme, introduced to prevent the collapse of some pension funds.
Crypto Trading Alternative – Presales
One strategy crypto investors have used to continue to make gains during the bear market is to find good crypto projects in their presale phase.
That is because presales typically offer investors a lower entry point as they wish to build capital to further develop their projects and protocols.
Once such ongoing presale is IMPT, which has $4 million in just ten days since launch.
The project wants to help ease the climate crisis by allowing users to offset their carbon footprint by earning carbon credits when shopping.
IMPT - New Eco Friendly Crypto
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