Bitcoin Price Prediction: A Risky Run-Up To Key US CPI Data?

Bitcoin price is back to performing dismally toward the end of the week despite bulls venturing toward $30,000. The largest crypto is down 0.5% to $29,344 amid one of the most critical weeks in crypto.

On the other hand, its peer, Ethereum, has remained relatively unchanged over the last 24 hours, trading at $1,852. Generally, the crypto market is still dealing with record-low volatility, with market watchers looking forward to significant market-changing events to alter the sideways course.

Navigating The US CPI Data and the SEC Decision on Bitcoin ETF

The Consumer Price Index (CPI) report is coming on Thursday and will show how the United States is fairing in the battle to meet the Federal Reserve inflation target. The Fed has over the past year hiked rates to as high as 5.5% – the highest in 22 years.

However, in June the bank paused the rate hikes but followed with a 25-basis point hike in July, a move that did not sit well with investors. The CPI on Thursday is of particular importance, especially with the market looking forward to a 0.4% bump in inflation.

The Fed has in the last few months said that the economy is in a disinflationary state, but with rising oil prices, this notion may not stand.

A spike in inflation could drive investors to Bitcoin and other crypto assets like Ethereum and XRP, which was partially deemed not a security in the early July Ripple-SEC ruling.

Still ahead in this week is a possible decision on the approval of a Bitcoin ETF proposal by, ARK Investment. The SEC will likely postpone the decision on the first ETF filing but Cathie Wood, the firm’s founder believes the regulator will eventually approve multiple proposals at a go.

If that happens, Wood is expecting the crypto market to go ballistic, led by Bitcoin price which has been stuck in a broader range between $28,000 and $32,000 but more recently in a narrow range between $29,000 and $30,000.

Is A Bitcoin Price Breakout on The Horizon?

Bitcoin price seems calm despite the anticipation of the CPI data later on Thursday, but the support provided by the 50-day Exponential Moving Average (EMA) (red) at $29,344 could play a key role in the resumption of the uptrend above $30,000.

The daily chart reveals the formation of a falling wedge pattern which has been awaiting confirmation since the beginning of August. This pattern suggests that the downtrend is nearing the end and bulls are getting ready to take control.

Adding credence to the bullish outlook is a buy signal from the Moving Average Convergence Divergence (MACD) indicator. Traders look out for bullish crosses in this momentum indicator to validate the call to buy BTC, with the MACD line in blue flipping above the signal line in red.

Similarly, with the Money Flow Index (MFI) almost crossing into the overbought region, investors are ready to jump in with both feet, betting on a CPI-triggered rally above $30,000 to $32,000.

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