Bitcoin signs its best week since March thanks to inflation: +7% in 7 days

For several weeks now, the crypto market has been vacillating between doubt and severe correction. Against all expectations, bitcoin seems to be recovering. According to the data, the flagship asset is indeed recording its best weekly performance since March 2026. A feat that many experts attribute to a major macroeconomic factor: the decline in inflation expectations in the United States. We'll tell you more below!

Bitcoin shows an increase of around 7% over the week ending July 5

The gloomy climate which weighed on the crypto and financial ecosystem dissipated in the space of a few days. And the bitcoin is one of the main beneficiaries. The proof: the price of this digital asset jumped 7% over a period of 7 days. At the time of writing, BTC is trading at around $63,500. It showed a slight decline before starting to rise again.

Crypto analysts agree on one point: the bitcoin rebound is in no way the result of chance. It results from a renewed optimism specific to the crypto market. But not only that! It is also a direct consequence of a radical change in long-term inflation expectations in the United States.

We refer more specifically to the decline in inflation breakeven. Closely followed by crypto traders, this indicator measures the economy's expectations of price increases by comparing traditional government bonds to inflation-protected bonds. According to the data, the two-year rate has fallen back below 2%. A first since the start of 2024! Especially since it is the Fed's fixed target.

For crypto investors and traders, the message is clear: fears of an uncontrollable inflationary spiral are now a thing of the past. For bitcoin in particular, this breakeven fall acts as a fuel. If inflationary pressures ease, the American central bank would indeed have greater room to maneuver to ease its monetary policy in the medium term. Enough to reduce the pressure exerted by high interest rates on risky assets, including bitcoin.

Another factor favorable to bitcoin: a less solid Dollar Index

Almost all the data confirms this! Historically, bitcoin (BTC) often moves inversely to American dollar. When confidence in the greenback crumbles, the flagship crypto tends to rise.

L'US Dollar Index (DXY) is currently showing obvious signs of fatigue. Experts point to the decline in WTI crude oil prices. The latter have in fact returned to their levels before the Iranian war. As the cost of energy is the main driver of the consumer price index, its decline provides relief to the real economy. Above all, it weakens the short-term safe haven status of the American dollar.

Freed from the selling pressure exerted by an omnipotent dollar, bitcoin therefore regains essential technical room for maneuver to break the psychological resistance of $63,000 and attract new spot purchase volumes.

The trajectory of inflation is not unanimous within the crypto community

Certainly, the bitcoin price jumped 7% over the last week. However, not all crypto analysts share the same optimism regarding falling inflation in the United States.

The YCC Macro account, for example, warned about X :

The Fed cannot declare victory just because gas prices are falling. Persistent inflation in services is precisely why policymakers should keep rates high for longer, even as the overall CPI continues to slow.

For his part, economist Robin Brooks believes that the drop in the price of oil could revive a disinflationary movement. According to him, the Fed's next decision could be a rate cut rather than an increase if this trend were to continue.

Bitcoin will have to wait for the American CPI to confirm its bullish momentum

Unless there is a last minute change, the publication of the American CPI is scheduled for July 14. According to crypto experts, two scenarios should be considered.

• An inflation figure lower than expected: this would confirm the disinflationary trend initiated by the decline in the inflation breakeven. Which will reinforce bets on a fall in interest rates. The scenario of a extended bullish rally for bitcoin will therefore be definitively validated.
• A bullish surprise: it would revive fears about the persistence of inflation in the United States. This would restore strength to the US dollar and could weigh on the price of bitcoin in the short term.

On a purely graphic level, the return of purchase volumes on bitcoin validates the formation of a solid floor above the long-term moving averages. The reduction in selling pressure is accompanied by a stabilization of outflows of institutional financial products. Which suggests that the surrender of weak hands.

In the short term, two major scenarios are now emerging for bitcoin:

• The clear break of current resistances would open the way to a rapid return to historic highssupported by a massive short squeeze on futures contracts.
• Conversely, bitcoin could retest its support zones if macroeconomic doubts persist or if the US dollar begins a technical rebound on its supports.

Despite bitcoin's rebound, caution remains in order

The recent bitcoin progress reflects a change in investor perception rather than a simple speculative movement. Falling inflation expectations, decline in WTI oil, questions about the Fed's evolution… These are all factors which create a more favorable environment for digital assets, including bitcoin.

The fact remains that several variables remain unknown. We are referring in particular to officials of the American central bank who continue to insist on their dependence on economic data. However, services inflation is still considered a factor of vigilance. The next statistics could therefore quickly modify the crypto market expectations.

One thing is certain: bitcoin is entering a pivotal week. The real verdict will now depend on the next US economic data. These will confirm or challenge the current optimism of the crypto market. File to follow closely…