Easing Inflation Could Spark Another Bitcoin Rally, Says 10x Research

Easing Inflation Could Spark Another Bitcoin Rally, Says 10x Research

As the US prepares to release its latest Consumer Price Index (CPI) data on February 12, cryptocurrency market participants are closely watching for any surprises. While consensus expectations suggest that inflation will remain unchanged at 2.9% year-on-year, one crypto analyst believes there is a "real possibility" that a lower-than-expected CPI print could trigger another significant rally for Bitcoin (BTC).


A Potential Upside Surprise for Bitcoin

Markus Thielen, head of research at 10x Research, outlined in a February 11 report that the CPI could come in lower than expected, potentially sparking a Bitcoin rally. He noted that most market participants anticipate the CPI to remain steady at 2.9%, the same as in December 2023. However, Thielen pointed to data from the Truflation Inflation Index, which tracks real-time inflation figures, showing a decline from 3.0% to 2.1%. This decrease suggests that inflation pressures may be easing faster than previously anticipated.


"If CPI surprises to the downside, with a print around 2.7% or 2.8%, Bitcoin could see a relief rally," Thielen said.


January's Rally and the Role of Inflation Data

Thielen referenced Bitcoin's remarkable $10,000 surge in January, which occurred after market expectations for a "third consecutive month of rising CPI" were upended by the 2.9% inflation print. The unchanged inflation rate provided unexpected relief to the markets, pushing Bitcoin back above the critical $100,000 mark. This momentum was temporarily halted after US President Donald Trump's tariffs on Canada, Mexico, and China in late January.


A similar rally following a lower CPI print could propel Bitcoin’s price to new heights. Thielen suggested that another $10,000 rally would bring Bitcoin's price closer to its all-time high of $109,000, reaching approximately $105,491—just 3.5% away from its peak price.


Market Sentiment and Future Price Predictions

At the time of publication, Bitcoin was trading at $95,490, showing a 2.65% decline over the past seven days, according to CoinMarketCap data. However, the broader market remains optimistic. A poll conducted by Benjamin Cowen, founder of Into The CryptoVerse, on social media platform X asked his followers where Bitcoin’s price would go after the CPI release. Out of 12,397 votes, 51.7% of respondents predicted that Bitcoin’s price would rise following the data release.


Meanwhile, Michaël van de Poppe, founder of MN Capital, also voiced a bullish outlook for Bitcoin. He suggested that Bitcoin could reach new all-time highs within weeks, drawing comparisons to gold’s recent streak of record-breaking prices.


As the February 12 CPI data looms, the crypto market waits in anticipation, hoping for a surprise to the downside that could trigger a fresh rally for Bitcoin and the broader cryptocurrency market

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