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Breaking News: Bitcoin Price Tumbles Toward $98,000: What’s Driving The Drop And What Lies Ahead
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Breaking News: Bitcoin Price Tumbles Toward $98,000: What’s Driving The Drop And What Lies Ahead

Stops Hunt: Bitcoin And Ethereum Wick Down Ahead Of U.S. Inflation Metrics

Reynaldo Marquez
Reynaldo Marquez
Last Updated: June 11, 2024 2:26 pm
2 mins read
bitcoin btc btcusdt

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Volatility has stuck the crypto market as the price of Bitcoin and Ethereum trend to the downside. The two largest cryptocurrencies are reacting negatively and with volatility to the U.S. Consumer Price Index (CPI) print, a metric used to measure inflation.

Related Reading: Bitcoin (BTC) Closes Week Above $21K, Is Bullish Reversal In Sight?

At the time of writing, Bitcoin (BTC) trades at $21,600 after a rejection north of $22,000 and a 4% loss in the last 24 hours. Ethereum (ETH) trades at $1,640 with a 6% loss over the same period after an aggressive crash from a major resistance area near $1,8000.

Both cryptocurrencies made a sudden move to the downside before the CPI print. Bitcoin quickly dropped to around $21,300 while Ethereum crashed to $1,640, the current price action is filling into those downside moves and hints at a potential further downside for the cryptocurrencies.

Bitcoin Price BTC BTCUSDT
BTC’s price sudden move to the downside. Source: BTCUSD Tradingview

CPI Prints Beats Expectations, What Does It Mean For Bitcoin?

The U.S. CPI print came in at 8.3% with a core CPI rising to 6.3%, expectations for the former stood at 8.1%. In other words, the market was expecting inflation to be lower than today’s metrics with the hopes of relief in monetary policy from the U.S. Federal Reserve (Fed).

A low CPI combined with a slowdown in the economy might have provided the financial institution with room to relax on its interest rate hike. However, market participants are pricing in another 75 basis points (bps) hike for the upcoming Federal Open Market Committee (FOMC).

There is a small chance, according to recent market expectations, of a more aggressive from the Fed with a 100-bps hike in interest rates. The current monetary policy of the financial institution has broken havoc across global markets and risk-on assets, such as Bitcoin.

A 100 bps hike might push BTC’s price down into its yearly lows and beyond. Economist and crypto analyst Alex Krüger said the following about the CPI print and its implication on the U.S. Fed monetary policy:

Dreadful core CPI numbers. The 0.3% MoM miss should delay any Fed pivot by at least two months. Shorts should have it easy for a while, BTD can wait.

What Could Prevent Further Losses For Bitcoin And Ethereum

The coming days are bound to see more volatility as the CPI print, market expectations about a hawkish Fed, combined with the upcoming Ethereum “Merge”. The event that will complete this network transition to Proof-of-Stake (PoS), “The Merge” has caused a lot of hype across the crypto market.

A portion of market participants is expecting the Ethereum price to operate under a “buy the rumor, sell the news” event, others expect a breach of the resistance around $2,000, and others expect the price to continue dropping from current levels.

Related Reading: Bitcoin Price This Tad Close To Reclaim $23,000 – Will It Hit The Target?

The latter has led to a spike in upside liquidity, as traders continue to short ETH and getting “squeezed” by larger investors. This could provide ETH with the ammunition to reclaim the area around $1,700, as the market heads into “The Merge”.

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Reynaldo Marquez
Reynaldo Marquez

Reynaldo Marquez

A literature major, Reynaldo Márquez has been deeply immersed in the crypto industry since 2017. His journey began with translating articles for various crypto news outlets, a role he took on with zeal. In 2018, amidst a challenging market, he embraced his first writing assignment, demonstrating his unwavering commitment to the nascent industry and the promise of change it bears for many people worldwide.
In March 2021, he joined the prestigious crypto news outlet NewsBTC and Bitcoinist, where he not only reported on the latest crypto news but also had the privilege of interviewing some of the industry's most influential figures. A year later, his dedication and hard work were recognized, and he was promoted to Managing Editor, a position he currently holds with pride.
He believes in honesty, good communication, hard work, and the power of cryptocurrency and its potential to transform people's lives, especially those alienated by the legacy financial system. Born in 1992 in Venezuela, Reynaldo is familiar with how governments and central banks can negatively affect people, their everyday lives, and their futures by creating inflation and erasing their hopes for a better future. Thus, like many Venezuelans, he embraced this new technology to help him and his family navigate difficult times.
In another life, Reynaldo would have pursued a career as an investigator, most likely tracking down the origins of the Cyberpunk movement with the publication of William Gibson’s ‘Neuromancer.’ The intersection between fiction and reality, with the materialization of Bitcoin in 2009, would have allowed him to dive deep into the crypto sphere as something more than a financial phenomenon but also a cultural shift in society that was brewing since the XX century, and maybe even sooner, in the XIX century with the publication of Henry David Thoreau’s ‘Civil Disobedience.’
But that’s for another life. In this one, Reynaldo has been trading to improve his trading skills. Since 2023, he has been trying to learn Python to create successful strategies and find ways to execute them. It is a difficult task, which continues to keep him busy today and will most likely continue to keep him busy in the near and long term.
In his free time, he enjoys lifting heavy objects, reading, watching movies, and listening to his favorite music. Some of his favorite authors are Walt Whitman, William Faulkner, Allen Ginsberg, James Baldwin, Raymond Carver, Ray Bradbury, George Orwell, Mario Vargas Llosa, Reinaldo Arenas, Rafael Cadenas, and many others. Lately, he has been primarily interested in reading about dystopic societies, a topic that deeply resonates with the crypto industry.
Since 2023, he has lived in Spain with his wife. He loves the weather, the food, and the people and their culture. They both expect to travel much more within the country they now call home and beyond its border. He hopes to retire with his wife, maybe in a quiet place near a beach, but most likely in a city close to a library and a university with his kids and, hopefully, grandkids.

Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

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Reason to trust

Strict editorial policy that focuses on accuracy, relevance, and impartiality
Created by industry experts and meticulously reviewed
The highest standards in reporting and publishing
How Our News is Made

Strict editorial policy that focuses on accuracy, relevance, and impartiality

Ad discliamer

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