Author: BitpushNews
The Consumer Price Index (CPI) released on Wednesday showed that the core CPI index, excluding food and energy costs, rose 0.3% for the third consecutive month. The overall CPI was up 2.6% from a year earlier, the first year-on-year increase since March this year.
After the new data was released, investors increased their bets on the Federal Reserve cutting interest rates at its December meeting. The FedWatch tool of the Chicago Mercantile Exchange shows that Wall Street is betting on a 25-basis-point rate cut at the December FOMC meeting, with the probability rising to 82%.
After the CPI data was released, US stocks opened flat and then rose slightly. The major indices closed with mixed results. The Dow Jones Industrial Average rose slightly by 0.11%, the Nasdaq Composite Index fell 0.26%, and the S&P 500 Index was basically flat.
The crypto market saw high volatility, with Bit falling to $86,300 earlier, but the bulls counterattacked, reaching a new all-time high of $93,500 during the session, and the Bit trading price was $90,451.16 at the time of writing, up 2.91% in 24 hours.
Another major news in the crypto space is that Trump announced the establishment of the Department of Government Efficiency (DOGE), which will be led by Elon Musk and Vivek Ramaswamy. This news has boosted the rise of Doge, which soared to $0.44 on Tuesday and retested that resistance level on Wednesday.
Coinbase Premium Index Rises to 7-Month High
CryptoQuant data shows that the Bit Coinbase Premium Index (a key indicator of US demand) has jumped to 0.2, the highest reading since April, highlighting the huge buying pressure from US traders.
The indicator measures the difference in Bit prices between Coinbase and the offshore Binance (the world's largest crypto exchange by trading volume). Coinbase is widely used by US investors and institutions.
While it is not yet clear what types of market participants are buying, the trading volume of the spot Bit ETFs listed in the US was strong on the day of opening. According to Barchart data, the BlackRock iShares Bit Trust ETF (IBIT) is the largest spot ETF with $40 billion in assets, and its trading volume in the first hour was about $1.2 billion, making it the fourth largest ETF by trading volume.
Likely to Enter a Consolidation Phase in the Short Term
According to Willy Woo, the founder of the data platform Woobull and a statistician, Bit may see more consolidation between $88,000 and $91,000, and then is expected to attack the next major resistance level of $102,000.
Woo said on the X platform that when Bit breaks its historical high, the market lacks historical data as a reference, and the price trend will become more volatile. Therefore, technical analysts often use tools such as the Fibonacci sequence and liquidation levels to predict potential resistance levels.
Woo pointed out that Bit's recent price fluctuations are in line with the Fibonacci levels and liquidation levels in the $88,000 to $91,000 range, indicating that the current price is in a relatively stable range.
Looking ahead, Woo believes that $102,000 is the next important technical resistance level. This target is based on a Fibonacci analysis of the historical cycle highs and the current cycle lows.
Bit is still in the early stage, but is expected to reach $500,000
In a report to clients on Tuesday, Matt Hougan, Chief Investment Officer of Bitwise, wrote: "This is no longer the first inning. But it's still too early for Bit to reach $500,000."
Hougan said that although the market is expected to correct to a consolidation phase, "it feels like $100,000 is just around the corner."
He also believes that $500,000 per Bit is the right dividing line between early and late, as this marks the point where Bit is truly 'mature' and compares it to gold.
Hougan explained: "Currently, the total market value of gold and Bit is about $20 trillion. If Bit can occupy half of the market share, then based on the current circulating supply, the price of each Bit will reach $500,000." He further pointed out that the attitude of central banks is a key factor driving the rise in Bit prices.
Hougan believes that if central banks start to include Bit in their reserve assets, it will significantly drive up the price of Bit. He cited the "Bit National Reserve" plan proposed by US Senator Cynthia Lummis as an example to illustrate the possibility of this trend.
The report states: "If central banks start to follow suit, the goal of Bit reaching $500,000 will no longer be distant. But considering the potential for Bit to drive the growth of the entire value storage market, as well as the reality of increasing government debt and money printing, Bit's long-term price potential is far beyond that. Even reaching $1 million or higher is possible."
