The crypto market, volatile by nature, has once again shown its fragility in the wake of the Trump-Harris debate and in the run-up to the release of the Consumer Price Index (CPI). Bitcoin, which has long been seen as an asset disconnected from traditional political and economic uncertainties, fell by 2.2% amid growing uncertainty. The event highlights how crypto can be influenced by unexpected external factors.
A dull debate, consequences for bitcoin
The Trump-Harris debate, expected by many to provide a glimpse into future policies, has instead left cryptocurrency investors wanting more.
Indeed, neither Donald Trump nor Kamala Harris addressed the issue of digital assets, a crucial subject for Bitcoin supporters.
In a market hungry for positive signals, the prolonged silence of politicians on cryptocurrency regulation has suggested a lack of commitment, if not palpable indifference.
This led to an almost immediate reaction: in just one hour, the price of Bitcoin plunged by almost $1,000, falling to local lows of $56,099.
Far from being a simple technical correction, this decline reflects a deeper concern among traders, who were hoping for clues about a possible pro-crypto policy.
As trading firm QCP Capital explained, the lack of commentary on crypto has caused increased uncertainty, conducive to a “risk-off movement.”
The IPC approach, an aggravating factor
At the same time, the anticipation of the publication of the Consumer Price Index (CPI) contributed to the downward pressure on Bitcoin.
This major economic indicator, which measures inflation in the United States, is crucial for traditional markets, but it also plays a determining role in the evolution of the price of BTC.
Against this backdrop, crypto investors, usually more inclined to ignore traditional economic indicators, have this time been paying attention. The reason? Fears that inflation could provoke an aggressive response from central banks, making risky assets less attractive.
The CPI forecast suggested a decline from 2.9% to 2.55%, but some experts, like those from QCPbelieved that the chances of an upward surprise were high.
If the CPI figures were to beat expectations, it could add to inflationary pressures and trigger a selloff in risk assets, including bitcoin.
Despite these fears, some experts remained optimistic. They anticipated a limited impact from the CPI. Indeed, attention was already turning to unemployment data, considered more crucial for the evolution of the market.
A technical resistance difficult to overcome
While political debate and CPI were putting pressure on Bitcoin, technical indicators were also not working in the cryptocurrency's favor.
On the 4-hour chart, traders have identified a notable resistance. BTC/USD is running into two key trendlines. The 200-period simple moving average (SMA) and exponential moving average (EMA) are reinforcing this barrier.
These levels, located at $59,200 and $58,840 respectively, acted as a ceiling that Bitcoin failed to break through.
This technical setup indicates some weakness in the current market momentum. As trader Daan Crypto Trades pointed out, until BTC breaks above these moving averages, it will be difficult for bulls to regain control of the market.
However, such resistance is not new, and many experts believe that Bitcoin is following a classic correction pattern before a major macroeconomic event like the CPI. So, while Bitcoin has lost ground, the crypto remains in a strategic position, ready to rebound as soon as external signals allow.
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