Bitcoin (BTC) Price Stumbles After Hotter-Than-Expected U.S. Inflation Data

Bitcoin took a hit on March 28, sliding over 3% after hotter-than-expected U.S. inflation data unsettled traders.

Bitcoin price took a hit on Wednesday, sliding over 3% after hotter-than-expected U.S. inflation data unsettled traders.

The cryptocurrency briefly touched $85,500 earlier in the session before reversing sharply, hitting a low of $83,971 by 08:58 ET (12:58 GMT). This marks the weakest level for Bitcoin since March 23.

The downturn follows the release of the U.S. Personal Consumption Expenditures (PCE) Index, the Federal Reserve’s preferred inflation gauge. While overall PCE figures aligned with expectations at 0.3% month-over-month and 2.5% year-over-year, core PCE—which excludes food and energy—came in at 2.8%, slightly above the anticipated 2.7%.

Core inflation is back on the rise.

March inflation data will be even more telling as the trade war rages on.

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The slight increase in core inflation could delay the Federal Reserve’s rate cuts, which is not ideal for risk assets like Bitcoin.

February's PCE is coming in lined up with expectations.

Slight core PCE beat could delay the Fed's rate cuts, and that's not ideal for risk assets like Bitcoin.

The reaction to the report was swift, with traders noting that PCE data is usually a key focus for the market.

PCE data coming up so it’s going to be a volatile day in the markets I reckon.

Bitcoin is now trading at $84,000 after a brief touch of $85,500 highs.

The next immediate support level is at $83,400, with a failure to hold opening the door to $82,000, where some traders expect a temporary bounce.

However, if selling pressure persists, Bitcoin may be on track for a deeper correction, with $80,000 as a critical level to watch.

A recovery above $86,000 would be needed to alleviate some of the downward pressure and potentially set the stage for a continuation of the upward trend.

On the other hand, a break below $80,000 could have significant technical implications, potentially opening the door for a more substantial decline.

"We're now at a pivotal moment for Bitcoin. A loss of the $84,000 support could lead to a decline towards the $78,000-$80,000 range before any major recovery occurs," according to crypto analyst Michaël van de Poppe.

"The crucial level to watch on lower time frames is $84,000, as a break below could open the door for further weakness towards the $80,000-$78,000 support range."

However, if Bitcoin manages to close above $88,000, it could pave the way for a rally to the $94,000-$98,000 resistance levels.

"A move above the 4-hour chart's critical trendline and the $84,000 level, along with hawkish inflation data, has shifted the short-term sentiment bearish," said trader CRYPTOSIXT.

"Immediate support is at $83,400, and a failure to hold could open the door to $82,000, where some traders anticipate a temporary bounce."

"But if selling pressure persists, it may be on track for a deeper correction, with $80,000 as a key technical level to watch."

Bitcoin is now trading at $83,981, showing a decline of 2.90% in the past 24 hours.

The post Bitcoin slides as hot inflation data sparks risk-off mood appeared first on CryptoSlate.

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