Bitcoin moved lower on Thursday, trading near $63,700 after a US inflation report matched expectations. The leading cryptocurrency was down less than 1% at the time of writing, and altcoins fell harder. The report initially seemed to help risk assets, but the momentum disappeared quickly.
Why the bounce faded
July’s Consumer Price Index rose 0.1% month over month and 3.4% year over year. Core inflation, which excludes food and energy, increased 0.2% monthly and slowed to 2.5% annually. The data lowered the chance of another Federal Reserve rate hike in September. Futures markets put the odds at roughly 38%, down from 46% before the release.
The first reaction was positive. Gold gained 1.3%, Ethereum rose just over 1%, Bitcoin climbed about 0.5%, and S&P 500 futures added 0.2%. Those gains did not last, especially in crypto.
Maksym Sakharov, co-founder and CEO of WeFi, said the softer print gives the Fed more room to decide on rates. But he added that one release won’t settle the inflation debate because volatility is already built into the market. The bigger issue may be positioning. Traders had placed bets in both directions before the data, so the report was always going to leave one side exposed to liquidations. That often triggers more swings. The first move may say more about leverage than conviction.
The details of the report also gave the Fed reason to stay patient. Shelter costs rose only 0.1%. Energy prices dropped 1.5%, and gasoline fell 2.9%. Some goods categories are moving past the tariff-related price increases from last year.
What to watch next
With no clear signal from the inflation data, investors are turning to other events. The Federal Reserve’s Jackson Hole gathering later in August could offer more clarity on policy. Then the September employment report is scheduled for September 4. The next inflation reading follows on September 11.
If jobs or inflation come in weaker than expected, markets may start pricing in looser policy. That could support risk-sensitive assets like Bitcoin. For now, the path remains uncertain.
Bitcoin technical outlook
The BTC/USD 4-hour chart still looks bearish. Bitcoin is trading below key moving averages, and technical indicators suggest more downside. The Relative Strength Index sits at 42, below the neutral 50, which points to growing bearish control. The MACD lines are also negative.
If selling pressure continues, Bitcoin could break below $63,000 and test the August 3 swing low near $62,185. A deeper decline might bring the July 6 low of $61,228 into play. Another major demand zone sits at $57,659.
On the upside, bulls need to push through the 4-hour inducement liquidity level at $64,430 first. After that, the resistance and TLQ level at $65,423 becomes the next target. Until then, the bias stays cautious, and another sharp reversal cannot be ruled out.
