Why Did The Bitcoin Price Rise Above $66,000 Today?
Bitcoin recently rose above $66,000 for the first time since April. This recent price rally from the flagship crypto is believed to be due to several factors, including the recently released inflation data.
Inflation Data Comes In Lower Than Expectations
The Consumer Price Index (CPI) inflation data was announced on May 15 and came in lower than expected. The CPI rose by 0.3% in April, against forecasts of 0.4%. The CPI data was also lower than those recorded in March and February, when inflation rose by 0.4%.
Therefore, the latest inflation data suggests that inflation in the US might be slowing down. This development has provided some relief for investors, as the Fed is likely to maintain a dovish stance and consider rate cuts as inflation looks to decline. Lower interest rates mean investors will be more confident investing in risk assets like Bitcoin.
Another factor contributing to Bitcoin’s rally is recent reports showing that some notable institutions are heavily invested in the flagship crypto. Bitcoinist reported that the State of Wisconsin has invested almost $99 million in BlackRock’s Spot Bitcoin ETF. Hedge Fund Millenium Management is also reported to hold $1.94 billion across five different Spot Bitcoin ETF products.
This presents a bullish outlook for Bitcoin as it suggests that institutional investors are interested in the crypto token for the long term. Meanwhile, from a technical analysis perspective, Bitcoin also looked primed for this rally, with crypto analyst Rekt Capital revealing that the flagship crypto was out of the post-halving “Danger Zone.”
Crypto analyst Mikybull Crypto also noted that Bitcoin was displaying a cup and reversal pattern on the weekly chart and added that the “breakout will be explosive and will send it to a cycle top.”
What Next For Bitcoin?
In a Telegram update, crypto trading firm QCP Capital stated that they expect this bullish momentum to take Bitcoin’s price to the previous highs of $74,000. They highlighted activity in the derivatives market and growing institutional demand as factors that could contribute to Bitcoin’s rise to this price level.
They also raised the possibility of this being the resumption of the bull market, stating that “the stars seem to be aligning on this breakout with significant sovereign and institutional adoption, abating inflation and upcoming US elections.” The trading firm added, “If this is indeed the start of the bull trend again, then this move could take us past all-time highs.”
Rekt Capital suggested that this might be the beginning of an upward trend for the flagship crypto as he revealed that the daily downtrend for Bitcoin is over. In another X post, the crypto analyst also noted that the Bitcoin bull market is not yet over.