Author: BitpushNews
After the release of the US Producer Price Index (PPI) data, Bitcoin continued to rebound and rise above $96,000, with a 2.5% increase in the past 24 hours. Among the mainstream Altcoins, XRP and DOGE led the rally with gains of 6% to 7%.
The report shows that the US PPI in December only rose 0.2% month-on-month, lower than the 0.4% in the previous month, and also lower than the 0.4% expected by economists. As a leading indicator of the Consumer Price Index (CPI), PPI plays an important role in the overall inflation level, and the cooling of PPI is a positive signal for the next move by the Federal Reserve.
The previous day, The Washington Post reported that sources close to the new Trump administration revealed that the president-elect will issue an executive order related to cryptocurrencies after taking office. These orders are expected to address the so-called "de-banking" issue and reverse the controversial SAB 121 policy, which restricts banks from providing services to cryptocurrency companies.
Cryptocurrency billionaire and Galaxy Digital founder Mike Novogratz had previously mentioned that SAB 121 was one of the policies of the Biden era, and that this policy would be quickly abolished after Trump took office.
The Washington Post reported that Trump is willing to support a cryptocurrency legislative strategy in the early part of his presidency, driven by a group of Silicon Valley tycoons, including A16Z general partner Marc Andreessen. This news immediately boosted the cryptocurrency market.
Derivatives market indicators show market volatility
Data from the derivatives market shows that the volatility of Bitcoin and other cryptocurrencies is expected to continue to rise. The short-term implied volatility of Bitcoin options remains high, and the VIX index, which measures the volatility of the US stock market, also remains at a relatively high level, indicating an increase in overall market uncertainty.
According to Deribit's data, the first Bitcoin options expiration date this year is January 24, two days after Trump's inauguration. The market is slightly optimistic about this time point, with relatively high demand for call options. Among them, the call option contract with a strike price of $99,000 is the most concentrated. QCP Capital analysts believe that the derivatives market data indicates that market volatility will continue to exist in January.
K33 Research had previously predicted that the inauguration day could be a good opportunity to sell, but the recent widespread decline in the stock market and digital assets has caused it to adjust this view. The institution stated that although the attractiveness of selling on the inauguration day has diminished, the market still needs to closely monitor the price trend next week. The report pointed out: "Although our previous monthly outlook was inclined to sell on the inauguration day, given the recent lows in the stock market and Bitcoin, the attractiveness of this strategy has greatly diminished. The S&P 500 index filled the post-election gap yesterday, and Bitcoin also touched a two-month low. De-risking operations will depend entirely on the price trend next week, and its impact will be temporary, as we remain optimistic about Trump's long-term impact on BTC."
Cryptocurrency research firm 10x Research said in a report that "lower-than-expected inflation data could trigger a Bitcoin rally" as the Federal Reserve considers the impact of inflation.
In a research report on January 14, Standard Chartered Bank's digital asset research head Geoffrey Kendrick stated that Bitcoin is currently facing macroeconomic risk pressures, and any pullback below $90,000 represents a "medium-term" buying opportunity.
The report stated: "If we do indeed retest that level (if it falls below $90,000, I expect it to fall below $80,000), I would view it as an excellent medium-term buying opportunity." Despite the short-term risks, Standard Chartered Bank reiterated its long-term price target of $200,000 for Bitcoin by the end of 2025.
Cryptocurrency traders should already be accustomed to short-term major pullbacks during bull markets. Fundstrat co-founder Tom Lee said on CNBC's "Squawk Box" that Bitcoin prices could pull back to $70,000 and then set new highs, ultimately reaching between $200,000 and $250,000 by the end of the year.
