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While the CPI index comes out above analysts’ forecasts, the Fed (Federal Reserve) finds itself under pressure and could raise rates in December. A direct macroeconomic threat putting bitcoin under extreme tension around the key level of $74,000.

In brief

  • October’s CPI inflation rises by +0.4% month-over-month (Core CPI at +0.3%), significantly exceeding market expectations.
  • Fed rate hike expectations for December’s meeting soar to 97%.
  • Bitcoin nervously oscillates around $74,200, threatening to break the psychological support at $74,000 if the liquidation wave intensifies.

US Inflation Surprises the Market

The October Consumer Price Index (CPI) report shocked Wall Street as well as the crypto ecosystem. This comes a few days after Michael Saylor showed 400 years of dominance for bitcoin. With a 0.4% MoM increase versus the 0.3% expected (and Core CPI steady at 0.3%), inflation shows persistent resilience that disrupts central bankers’ plans.

This persistence removes chances of a short-term rate cut and strengthens prospects for a Fed rate hike in December. Governor Christopher Waller even warned that a 25 basis point increase is now the central scenario for December. Some experts do not rule out a more aggressive 50 basis point tightening if indicators do not ease.

Impact of Inflation and Fed Rate Revision in December

This monetary anticipation reversal caused an immediate capital reallocation towards the dollar and bond yields, to the detriment of risk assets.

Will Bitcoin Hold its Line of Defense?

Currently stabilized around $74,200, the crypto queen is directly impacted by the firmness of the US central bank and the surrounding nervousness. For many ecosystem observers, this drop synchronized with the release of macroeconomic data is not a mere coincidence. Rather, it appears as a strategy orchestrated to rescue leveraged positions and provoke panic, as highlighted by Gordon Gekko on X:

Manipulation at its peak. They push Bitcoin’s price down after inflation data release to provoke panic and eject you. Fortunately, we were prepared as I warned you last week. Now, are you ready for what’s next?

Manipulation at its peak. They push Bitcoin’s price down after inflation data release to provoke panic and eject you. Fortunately, we were prepared as I warned you last week. Now, are you ready for what’s next?

If selling pressure forces bitcoin to break its $74,000 support, the market could face a deeper correction toward $73,600. Conversely, if the current zone manages to hold despite rate pressure and market shocks, the pioneer crypto will send a remarkable strength signal.

Caught between the overheating of US inflation and the imminent threat of a Fed rate hike, Bitcoin (BTC) is in the danger zone. Between cyclical panic and an accumulation opportunity, the battle at $74,000 promises to be decisive for the rest of the cycle. In your opinion, is this a market manipulation or a genuine bearish signal for the year-end?

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The world is evolving and adaptation is the best weapon to survive in this undulating universe. Originally a crypto community manager, I am interested in anything that is directly or indirectly related to blockchain and its derivatives. To share my experience and promote a field that I am passionate about, nothing is better than writing informative and relaxed articles.

The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.