Bitcoin to Reach New Highs if US Inflation Slows, Says 10x Research Head
Summary:
Markus Thielen, the head researcher at 10x Research, suggests that Bitcoin (BTC) could reach a new all-time high if the US inflation rates slowdown. He predicts a strong performance from Spot Bitcoin ETF inflows leading up to the May CPI results. However, if CPI results exceed expectations, the momentum could weaken. Thielen's analysis reveals that Bitcoin's price shifts are not random but are fundamentally influenced mainly by inflation. He also provides historical instances of Bitcoin's price decline following higher-than-expected CPI results.
The head researcher of 10x Research, Markus Thielen, believes that for Bitcoin (BTC) to break its own March records, US inflation must decelerate when figures are published next month. As per Thielen's report on May 29, the crypto currency would touch a new all-time high if inflation rates are 3.3% or less. This is a subtle drop from the last released Consumer Price Index (CPI) of 3.4% on May 15 by the US Bureau of Labor Statistics, due next on June 12. Thielen anticipates a solid performance of Spot Bitcoin ETF inflows for the two weeks leading to the May CPI release. However, a CPI higher than forecasted could potentially stall this momentum, as witnessed previously.
Farside data shows positive day-to-day Spot Bitcoin ETF inflows starting from May 13, with the foremost day being May 21, recording inflows worth $305.7 million. The movement of Bitcoin prices is largely hinged on CPI fluctuations, as per 10x Research. Thielen asserts that Bitcoin price shifts are not arbitrary but tethered to fundamental influences primarily inflation. Instances from earlier this year showed Bitcoin prices witnessed a dip following elevated CPI figures. For instance, the April 10 CPI was marked at 3.5%, marginally more than predicted, causing Bitcoin prices to fall 6.67% to $56,000 on April 30.
The past 30 days have seen Bitcoin rise 7.57%. Thielen remarks that the sluggish inflows throughout January, following the initial $611 million inflow on Spot Bitcoin ETFs launch on Jan. 11, were majorly due to more than expected CPI results. The CPI for that month was 3.4%, more than the anticipated 3.2% and more than December's 3.1%. Thielen conjectures that Bitcoin's weakness in January and strength in March, followed by a two-month consolidation, was not coincidental.
Published At
5/30/2024 9:05:42 AM
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