Bitcoin Price Slides 3% Amid US Inflation Concerns

Bitcoin is experiencing a downward trend in its price after the release of macro data on March 14 that showed increased inflation in the United States. The BTC price rapidly declined from its all-time highs to $71,200, and at the time of writing, there has been no significant rebound, leaving BTC/USD down by 3.3% for the day. The Producer Price Index (PPI) for February exceeded expectations, indicating that inflation remains elevated. This data, along with previous figures such as jobless claims and the Consumer Price Index (CPI), is causing concerns for the Federal Reserve. Financial commentator Tedtalksmacro suggested that the Fed would keep interest rates high for a longer period based on this data.

The Federal Open Market Committee (FOMC), scheduled to meet on March 20, was already not expected to implement a rate cut. According to CME Group’s FedWatch Tool, the likelihood of a rate cut at the May FOMC meeting is currently only 6.2%. Looking at the broader picture of BTC’s price movement, analyst Rekt Capital emphasized that all-time highs are typically volatile periods where price action needs time to settle before continuing its trend. History has shown that Bitcoin experiences both upward and downward volatility around these levels. Once the volatility subsides, it can enter a phase of price discovery.

Another trader, Jelle, observed that BTC’s price patterns indicate strength recovery later in the U.S. trading session while weakness is seen around the market open. Bitcoin has been particularly volatile during the U.S. Market Open hours, especially when ETF trading goes live. The late U.S. session and the Asia session have shown a recovery from these downward movements.

The current macro data and inflation concerns are impacting Bitcoin’s price, causing a decline from its all-time highs. The Federal Reserve is expected to keep interest rates high for an extended period based on these factors. Analysts remain optimistic in the long-term prospects of Bitcoin, as they believe that price discovery awaits once the volatility around all-time highs settles. In the shorter term, BTC price patterns suggest a recovery during the late U.S. trading session and the Asia session.