Why Bitcoin Price Dropped after US CPI Announcement
2024-08-15
Bittime - Bitcoin fell 3.8% after the release of US CPI data, reflecting sensitivity to inflation. Prices plummeted from $61,809 to $58,883. Read this article in full!
Bitcoin Price Drops after US CPI Announcement
Bitcoin prices fell by 3.8% immediately after the Wall Street open on August 14. This decline was caused by the latest US Consumer Price Index (CPI) data for July, which showed the possibility that interest rates would fall in 2024.
Bitcoin Plummets from $61,809 to Lowest Level
Within three hours, Bitcoin plummeted from $61,809 to an intraday low of $58,883, and daily trading volume jumped 5%, reaching $32.12 billion, according to TradingView.
Month-on-month inflation increased by 0.2% according to the July CPI report, following a decline of 0.1% in June. The annual inflation rate reached 2.9 percent.
Slightly lower than estimates of 3 percent, this was the smallest increase in the 12 months since March 2021. The data does not appear to favor Bitcoin and other crypto assets, which have generally grown rapidly as a result of negative macroeconomic sentiment.
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Bitcoin Has Been Liquidated in Four Hours
In the last four hours, more than $25.94 million of long Bitcoin positions have been liquidated. Total liquidations in the broader crypto market reached $143.66 million, with long positions reaching $85.6 million.
Bitcoin Shows Sharp Drop
A big move in the Bitcoin futures market saw a sharp drop to $58,883. Market makers often take advantage of important macroeconomic events to liquidate Bitcoin.
Conclusion
Following the announcement of the US CPI data on August 14, Bitcoin's price decline of 3.8% reflects the crypto market's sensitivity to macroeconomic changes.
The data showed annual inflation of 2.9% and a monthly increase of 0.2%, which was slightly lower than expected. This has led to negative sentiment in the crypto market.
The strong market reaction to the economic release saw a sharp decline within three hours, with Bitcoin dropping from $61,809 to $58,883, as well as a massive liquidation of long positions.
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