This week Bitcoin BTC has almost reached positive territory, paring its seven-day losses to -0,73,5%. However, traders are still cautious ahead of the US Consumer Price Index (CPI) release on October 24. Today, BTC has pared its losses, rising 1,5% to $110,065.
The CPI report, delayed due to the government shutdown, has taken on particular importance ahead of the Federal Reserve’s next meeting, scheduled for October 29.
Economists expect headline inflation in the U.S. to rise 3,1% year-over-year, slightly higher than the 2,9% rate recorded in August. The core consumer price index (CPI), which excludes food and energy, is expected to remain unchanged, indicating a gradual slowdown in growth.
However, with inflation rising for six months in a row, market participants fear that another unexpected rise could lead to renewed volatility in the cryptocurrency and stock markets.
Low inflation rates can stimulate risk appetite and encourage Bitcoin to the $117,000–$120,000 range, while highs could trigger another sell-off towards $100,000.
Notably, gold continued to fall this week, losing 8% in two days and nearly $2,5 trillion in market capitalization, marking its largest drop since 2013. This decline has led some analysts to expect a shift in capital flows toward digital assets.
According to Bitwise calculations, a modest outflow of 3-4% from gold will allow for a rise Bitcoin above $242,000.
CryptoQuant data confirms Bitcoin’s potential: daily spot trading volume on Binance has nearly doubled since the beginning of October, rising from an average of $3-5 billion to $5-10 billion.