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BTC Approaches $62,000 Amid Aggressive Fed Stance and PPI Report; CPI ahead
Last Updated: May 15, 2024 3:13am EDT | 4 minute read
On Wednesday, Bitcoin traded at $61,949, up 0.65%, as the Federal Reserve’s aggressive stance on interest rates affected its price outlook. Concerns about inflation and higher interest rates have dampened investor sentiment towards cryptocurrencies.
The recent US Producer Price Index (PPI) report, which met expectations, has strengthened the expectation of prolonged high interest rates. The upcoming release of the Consumer Price Index (CPI) will be monitored closely for further insights.
The Fed’s aggressive stance and the impact of the US PPI on the price of BTC
The Federal Reserve’s aggressive stance on interest rates is significantly influencing Bitcoin’s price outlook. Inflation concerns and expectations of higher interest rates have dampened investor sentiment towards risky assets like cryptocurrencies. The recent US Producer Price Index (PPI) report.which met expectations, further strengthened the forecast of high and prolonged interest rates.
In April, the US producer price index (PPI) rose 2.2% year-over-year, falling in line with expectations. Core PPI, excluding food and energy costs, increased 2.4%. These figures provide greater justification for the Federal Reserve to maintain higher rates for an extended period.
Investors are closely monitoring Federal Reserve officials’ statements. Cleveland Fed President Loretta Mester has expressed a desire to begin tapering asset purchases. However, the Fed appears to be taking a cautious approach to the economy, which could pose a challenge for Bitcoin and other cryptocurrencies.
- Impact of PPI: US PPI rose 2.2% year-over-year in April, while core PPI rose 2.4%.
- Federal Reserve: The aggressive stance on interest rates is dampening investor sentiment.
- Bitcoin Outlook: Expectations of higher interest rates negatively impact Bitcoin and other cryptocurrencies.
The Federal Reserve’s hawkish stance and in-line US PPI data have bolstered expectations of higher interest rates, dampening investor sentiment towards Bitcoin and other cryptocurrencies.
Bitcoin is consistently ahead of CPI, retail sales, and manufacturing insights
Major economic data from the United States revealed notable changes on Wednesday. The core consumer price index (CPI) for April rose 0.3% month-on-month, down from the previous 0.4%. Meanwhile, core retail sales increased 0.2%, a significant decline from the previous 1.1%.
The overall CPI remained stable at 0.4% month-on-month and showed a slight decline year-on-year from 3.5% to 3.4%. The Empire State Manufacturing Index improved to -9.9, from -14.3, indicating a less severe contraction in manufacturing activity.
Retail sales grew 0.4% in April, slowing from the previous month’s 0.7% increase. These data collectively suggest a mixed economic outlook, with inflationary pressures persisting alongside fluctuations in consumption and manufacturing activity.
El Salvador mines 474 Bitcoin using volcanic geothermal energy
El Salvador has attracted a lot of attention for its innovative and eco-friendly approach to Bitcoin mining. Under the leadership of President Nayib Bukele, the country is using volcanic geothermal energy to mine Bitcoin, setting a sustainable example for other nations. This method not only increases El Salvador’s Bitcoin reserves but also promotes responsible mining practices.
Over the past three years, El Salvador has mined nearly 474 bitcoins, adding to the state’s cryptocurrency holdings https://t.co/8dYn1i4fZc pic.twitter.com/VXAXOLGtis
— Reuters (@Reuters) May 15, 2024
From September 2021, El Salvador mined approximately 474 bitcoins, using only 1.5 megawatts of the 102 megawatts generated by its geothermal power plant. This initiative is in line with the country’s national energy and environmental policies, underlining the commitment to sustainability in the cryptocurrency sector.
Despite initial skepticism, El Salvador’s approach has gained global recognition. The country addresses environmental concerns associated with traditional mining by integrating renewable energy with Bitcoin mining. This demonstrates the potential for cooperation between cryptocurrency miners and sustainable energy projects around the world.
- Sustainable extraction: El Salvador uses volcanic geothermal energy to mine Bitcoin, setting an example of sustainability.
- Reserves increased: Since September 2021, the country has mined 474 bitcoins using a minimal amount of energy.
- Global Recognition: El Salvador’s method shows the potential of combining cryptocurrency mining with renewable energy.
Eco-friendly Bitcoin mining in El Salvador using volcanic energy exemplifies sustainability and increases BTC reserves. This innovative approach can positively influence Bitcoin prices through increased adoption and environmental awareness.
Bitcoin price prediction
With a rise Bitcoin price prediction, Bitcoin (BTC/USD) is trading at $61,949, up 0.65%. On the 4-hour chart, the pivot point (green line) is at $61,547. The immediate resistance levels are at $63,164, $64,271, and $65,504. Immediate support levels are at $60,275, $59,218 and $58,237.
Technical indicators suggest a favorable environment for a bullish trend. The Relative Strength Index (RSI) is at 50, indicating balanced momentum. The 50-day exponential moving average (EMA) stands at $61,626, providing further support to the current price.
An uptrend line is strengthening BitcoinThe price is around the $61,630 level. On the upside, the next resistance lies at $63,165, extended by a downtrend line. Overall, the 50 EMA and the RSI both favor a buying trend.
Conclusion: Bullish above $61,547; a break below this level could trigger a strong selling trend.
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Disclaimer: Cryptocurrencies are a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all your capital.