The force of inflation, a perennial nemesis that continuously claws away at the value of money, is yet again making its presence felt, this time outpacing expectations. The Consumer Price Index (CPI) for August came in at a 3.7% year-on-year increase, just a notch higher than the predicted 3.6%. The largest contributing factor was indubitably gasoline, which was responsible for over half of the increase. Additionally, the shelter index also experienced its 40th consecutive monthly increase.
This data surge rattled the crypto markets with a stark snap in price volatility observed. Riding this turbulence was Bitcoin, bedeviled with the unsettling sustenance of the $26,000 mark against a backdrop of macroeconomic inflations outstripping forecasts. This price uncertainty fuelled traders’ apprehension for the Wall Street opening oscillations after the latest CPI report publication.
Experts had, however, issued a heads up that such a spike in CPI would spark market pressure due to the implication that inflation was more obstinate than initially projected. This would in turn influence how restrictive economic policies would be in the future, leading to a potential tightening of regulations.
One popular trader hinted, “We’re foreseeing a +4% in the next CPI owing to rampant hiking gas prices”. The very thought of inflation persisting as an insurmountable problem in the forthcoming part of the year lends credibility to the anticipated volatility.
On the other hand, some market participants remain positive about holding strong amidst the price momentum. Keith Alan, co-founder of Material Indicators, optimistically noted how Bitcoin’s strength might have waned somewhat, but believed it stout enough to retain much of what was regained after the bounce.
Yet, Bitcoin faces a strenuous climb against a loaded field of technical resistance layered above the current spot price range, taking the form of countless daily moving averages. This proves to be an uphill battle for its liquidity, especially in the tumultuous climate of Wall Street’s roller coaster ride. As it reels from this bout of volatility, the BTC/USD lacks clarity of direction.
Risk, volatility, and speculation – these words ring loudly in the digital sphere but are the lifeline sustaining the crypto markets. But before we dash towards the gold rush, let’s remember, every investment carries an equivalent risk, and an extensive shoal of due diligence is the only lifeboat sailing in these uncharted waters. As the bell tolls for Wall Street, let’s brace ourselves for the untold fortunes. Let’s not forget; there’s both a propelling thrill and a numbing uncertainty that underlies every leap into the vagueness of the future.
Source: Cointelegraph
