Key Insights:
- A bullish reversal pattern has been detected on Bitcoin’s daily price chart, indicating a potential shift in market momentum.
- Tonight’s CPI print may influence anticipated rate changes, with markets now forecasting four Federal Reserve interest cuts this year, a notable increase from one projected in January.
A significant technical analysis pattern hinting at a boundary reversal has manifested on Bitcoin’s (BTC) daily price chart as market players anticipate U.S. inflation information due on Wednesday to stabilize risk assets.
BTC has lost significant value recently, dropping from $100,000 last month to below $80,000 due to several influences, including risk aversion in markets, anxieties over Trump’s tariffs, and fears of a U.S. recession. Additionally, the disappointment from lacking new BTC acquisitions under Trump’s strategic reserve plan exacerbated the downward pull.
However, despite prices sinking to multi-month lows under $80,000, the relative strength index (RSI)—a commonly tracked momentum indicator—did not mirror this depreciation. Instead, it created a higher low, contradicting the lower low seen on the price chart, verifying what is termed a bullish RSI divergence.
This divergence suggests that while prices decline, selling momentum is diminishing, which could foreshadow an impending return to a bullish trend.
The emergence of this pattern could not be more timely, with the U.S. consumer price index for February, set for release at 12:30 UTC, anticipated to display favorable developments.
CNBC anticipates the data will reveal a headline CPI and core figure increase of 0.3% month-on-month for February, suggesting an annualized headline CPI of 2.9% and 3.2% for the core, each 0.1 percentage point lower than in January.
QCP Capital, a crypto trading firm based in Singapore, remarked on Telegram: “Tonight’s CPI print may set the standard for rate expectations, as markets now factor in four Fed cuts this year, an uptick from just one in January. Will inflation statistics confirm this shift or induce fresh volatility?”
