Bitcoin reached above $76,000 on Tuesday, a monthly high buoyed by US inflation data. The Producer Price Index for March came in below market expectations, though analysts noted a concerning 4% annual increase. Traders monitored a key technical level as Bitcoin’s price action prompted a wave of short liquidations.
Bitcoin surged to local highs above $76,000 on Tuesday, marking its best performance since mid-March. The move came as US economic data continued to influence risk assets.
The March Producer Price Index report from the US Bureau of Labor Statistics showed a 4.0% year-on-year increase, the largest 12-month advance in over a year. Markets had anticipated a higher figure of 4.7%, with the actual month-on-month change registering at 0.5%.
“The March rise in final demand prices can be attributed to a 1.6-percent advance in the index for final demand goods,” an official statement noted. Despite the lower-than-expected print, market reactions were hawkish, with trading resource The Kobeissi Letter stating, “Inflation is back.”
Market expectations for Federal Reserve interest-rate cuts remained positioned for the end of the next year, as shown by data from CME Group’s FedWatch Tool. Among traders, Bitcoin’s price action continued to generate scrutiny and triggered significant short liquidations around the $75,000 level.
Keith Alan, cofounder of trading resource Material Indicators, compared current action to 2022 patterns. He argued that if history mimicked itself, price could approach the 21-Week Moving Average near $78,300, a level he said would “not be an easy level to break.” A rejection from that trend line, he warned, could send Bitcoin into its next leg downward.
