Cryptocurrency markets are experiencing volatility ahead of the US Personal Consumption Expenditures (PCE) inflation report due to be released on Friday.
Bitcoin Investors Warn to Pull Back as US Inflation Data Approaches
Many major cryptocurrencies have fallen, and investors have warned of further declines in Bitcoin (BTC) prices.
In the last 24 hours, some of the largest cryptocurrencies have lost up to 5% in value. Meme coins Shiba Inu (SHIB) and Dogecoin (DOGE) led the market decline, losing nearly 5% each.
Additionally, XRP, Solana's SOL, and BNB Chain's BNB lost 2% in value. Bitcoin is testing the $67,000 support after a brief rally to $70,000 earlier in the week.
Meanwhile, Ethereum (ETH), which made significant gains last week following positive regulatory decisions, is down more than 5% since Monday.
Stronger-than-expected consumer sentiment and weak Treasury sales are weighing on Bitcoin prices, according to the trading desk at Japanese crypto exchange bitBank.
“The price will likely not show clear direction until the US PCE announcement on Friday, and this could be a make-or-break event for Bitcoin,” bitBank said in an email.
“If inflation data comes in hotter than expected, Bitcoin could give up about half of its gains over the last two weeks and fall to around $65,000.”
FxPro senior market analyst Alex Kuptsikevich echoed this thought and highlighted possible scenarios: “In the most bearish scenario, the price could drop to $60,000.
“A more optimistic scenario would be a drop to the $65,000 area where the 50-day moving average is located,” he said.
*This is not investment advice.