Bitcoin hit $58,000 at Wall Street’s opening on July 12 as markets reacted to “sticky” U.S. inflation data.
Bitcoin, PPI Reaction Positively Join Stocks
Bitcoin (BTC) price momentum is improving after the producer price index (PPI) rose more than expected in June, according to data from Cointelegraph Markets Pro and TradingView.
The annual PPI came in at 2.6%, compared to the expected 2.3%, up 0.1% from the previous month.
“On an unadjusted basis, the final demand index rose 2.6 percent in the 12 months ended June, the largest increase since it rose 2.7 percent in the 12 months ended March 2023,” according to an accompanying press release from the U.S. Bureau of Labor Statistics.
Contrary to the Consumer Price Index (CPI) numbers on July 11, BTC/USD edged higher along with US stocks as the PPI release avoided a downtrend, while the dollar tumbled.
Popular trader Skew wrote as part of a response to X (formerly Twitter): “So overall PPI will be stagnant, if not higher year-on-year, due to rising prices and tight supply.”
“Rising prices for energy, food and traded services are not a good prospect.”
Skew noted that excluding energy, food and traded services, the index was “basically flat”, which came as little surprise to markets.
“The initial reaction was DXY and yields rose before falling, which suggests the market is moving into a phase of anticipating harsh reality as demand continues to decline,” he concluded.
“NQ & ES are likely to recover from here as hedges unwind. The end of the day performance will be important.”
As of this writing on July 12, the US Dollar Index (DXY) is down 0.35%, heading towards its lowest level in a month.
Skew then described the spot order book at Binance, the world’s largest exchange, as “pretty healthy.”
“The order book is biased towards bid, but we need to see if this translates into bid as the market moves,” he commented, along with a chart showing the liquidity zones.
Analysts Call for BTC Price Daily Closing Higher
Some have also called for a stronger statement to be made to support the idea that BTC/USD is in a long-term recovery.
Related: Dip Buy? Bitcoin Institutional Investors Add 100K BTC in One Week
Popular trader Rekt Capital highlighted that the minimum price required to close the day is $58,350.
“There’s a bounce that Bitcoin needs and the price is now challenging the lower high resistance again,” he told his X followers along with a chart explaining the PPI reaction.
“Bitcoin needs to break the Lower High and more importantly close above $58,350 (black) to set up a rally to $60,600 (blue).”
Rekt Capital has reiterated previous reports that BTC/USD is attempting to break out of a downtrend line, but this has been met with strong resistance in recent days.
This article does not contain any investment advice or recommendations. All investment and trading moves involve risk, and readers should conduct their own research when making decisions.