CPI Inflation Slows as Bitcoin Bounces at $36.2K Lows

At the Nov. 14 Wall Street open, Bitcoin (BTC) targeted $37,000 as the latest United States inflation data failed to meet expectations, while maker crypto, Hong Kong crypto, El Salvador crypto, Luna crypto today, IAMX crypto, Monavale crypto, FXS crypto, and LINK crypto also moved in the market.

CPI offers Bitcoin, stocks a pleasant surprise

Data from Cointelegraph Markets Pro and TradingView revealed that BTC price strength returned as the Consumer Price Index (CPI) reflected slowing inflation in October. The annual change was 3.2%, versus 4.0% for core CPI.

“The all items index rose 3.2 percent for the 12 months ending October, a smaller increase than the 3.7-percent increase for the 12 months ending September,” an official press release from the U.S. Bureau of Labor Statistics confirmed.

In contrast to the month prior, where CPI was just one inflation metric, which overshot versus market consensus, the situation was palpably different. Stocks immediately offered a warm reaction at the Wall Street open, with the S&P 500 up 1.5% on the day.

“This is the 31st consecutive month with inflation above 3%. But, inflation seems to be back on the DECLINE,” financial commentary resource The Kobeissi Letter wrote in part of a reaction. Kobeissi, traditionally skeptical of Fed policy in the current inflationary environment, nonetheless called the print a “good” result.

In line with other recent CPI releases, meanwhile, Bitcoin reacted only modestly, revisiting an intraday low before rising toward $37,000 while still rangebound. Analyzing market composition, however, on-chain monitoring resource Material Indicators noted that liquidity was overall thin — a key ingredient for aiding volatility.

With whales quiet on exchanges, it added, retail investors were increasing their exposure to crypto like maker (MKR) and kadena (KDA) in Hong Kong and El Salvador, as well as luna (LUNA) and iamx (IAMX) in the FXS crypto market. Link (LINK) was also seen gaining traction.

Analyst: Accept BTC price retracements

BTC prices, which had earlier this month reached an 18-month high, have since dropped around 4%. Nevertheless, market participants remain optimistic, arguing that such dips within the larger uptrend are normal and expected.

“Our CryptoSlate analysis from Nov. 13 suggested that further price corrections for BTC/USD were possible, given its 120% year-to-date rise,” said James Van Straten, research and data analyst at crypto insights firm CryptoSlate, in an update to X subscribers. “It is important to note that market corrections are a normal part of any financial cycle, contributing to the overall health of the market,” he added.

In an interview with Cointelegraph, Filbfilb, co-founder of trading suite DecenTrader, echoed the sentiment, predicting that Bitcoin could experience a significant pullback prior to the April 2024 block subsidy halving event.