- Bitcoin Dips Below $84K Before Core PCE Data Release
- Rising Core Inflation Sparks Market Volatility Fears
- Analysts Signal Possible Bitcoin Trend Weakness
The value of Bitcoin (BTC) dropped under $84,500 during March 28 trading when market participants expected Core Personal Consumption Expenditures Index numbers to be revealed. The cryptocurrency reached its lowest point since March 23 before reversing direction and coming close to $85,500.
The analysts observed that the Bitcoin price drop seemed to stem from a pre-Core PCE data release correction process that typically produces heightened market instability. The movement suggested a liquidity hunt, where the market clears leveraged positions before a potential trend shift.
Bitcoin Reacts to US Inflation Data
The US Core PCE Index for February exceeded prediction levels for inflation. The actual month-on-month and annual PCE readings both corresponded to predicted figures of 0.3% and 2.5%. The Core PCE Index moved 0.1% above expectations since it removes food and energy components from its calculations.
Financial analysts suggested that rising core inflation could shape the macroeconomic outlook for 2025. The Kobeissi Letter reports that core inflation has started to increase notably as new January inflation figures suggest the chance of stagflation. Market conditions would become clearer after analysis of forthcoming March inflation data is examined.
The inflation data did not impact Bitcoin prices because analysts still watched prices staying above $80,000 while maintaining a cautious outlook for the market.
Market Analysts Expect Further Volatility
Market volatility was expected to increase by traders after they released the inflation report. The popular analyst at Daan Crypto Trades said that “PCE data coming up makes the market expect high volatility in today’s trading.”
Multiple traders identified emerging signs which could indicate the Bitcoin uptrend is showing weakness in its current position. The Bitcoin trend stays positive according to Michaël van de Poppe but he sees signs that it could potentially deteriorate. A potential drop of Bitcoin below $84,000 would trigger a market scan that could extend to the $78,000 to $80,000 area which would precede another price increase.
TheKingfisher market analyst explains that short-term price squeezing signals exist but long-term market analysis does not back up persistent bullish trends.As Bitcoin remains in a critical price range, traders will closely monitor its movement to determine whether the market is preparing for a bullish breakout or further downside pressure.
