Bitcoin came close to registering its first golden cross since last November as its price touched an intraday high of $79,837. The 50-day Exponential Moving Average (EMA) indicator line briefly crossed above the 200-day EMA on the daily chart. However, that technical momentum failed to hold after the release of US inflation data forced the price back to around $77,438, leaving a 1.19% gain on the day.
A hotter inflation print dampened prospects for further gains. The monthly US core Consumer Price Index (CPI) came in at 0.3%, topping analysts’ expectations of 0.2%. The inflation report immediately triggered a reaction in the futures market. According to CME FedWatch calculations, the probability of the US central bank raising interest rates by 25 basis points surged from 69% to 86.5% just hours after the inflation data was published.
Why the Market Reversed Course
The rising odds of a rate hike bring a historical pattern familiar to many traders: monetary tightening typically precedes a risk-off shift among investors. Capital allocators tend to pull money out of high-risk assets like Bitcoin and tech stocks when borrowing costs are projected to rise.
Despite the downward pressure on price, Bitcoin’s technical backdrop on higher timeframes remains largely intact. The daily Average Directional Index (ADX) indicator is holding at 45. That reading sits well above the 25 threshold, signaling a strong underlying trend behind the current price action. Similarly, the daily Relative Strength Index (RSI) stands at 55.5, placing the market in a neutral-bullish zone without signaling overbought conditions.
Short-Term Selling Pressure
The picture looks different on lower timeframes. On the 4-hour chart, the RSI indicator has slipped into bearish territory at 43.3. The Squeeze Momentum indicator also recently triggered an active status as volatility widened to 3.95%.
Despite facing dual pressure from macro inflation and short-term indicators, the golden cross on the 4-hour chart remains intact since first forming in late August. Buyers still retain some hope, though they now face head-on the prospect of central bank policy tightening.
For traders eyeing a resistance breakout, today’s rejection serves as a useful reminder of market sentiment hierarchy. Daily chart patterns often give way when US macroeconomic figures take an unfavorable turn.
Reported by Decrypt.
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Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
