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#Gate广场五月交易分享 The Federal Reserve is expected to see inflation heat up in April, with BTC facing a risk of dropping to $70k
On May 10, when the US releases the inflation report next week, Bitcoin may face weaker support than during the previous two CPI data releases, increasing the risk of falling back to $70,000.
The latest Cleveland Fed real-time inflation forecast estimates that the April CPI will rise year-over-year to 3.56%, up from 3.3% in March; the expected monthly CPI is 0.45% (below 0.9%), with core CPI at 2.56% YoY and 0.21% MoM (previously 2.6% and 0.2%). The official April CPI report will be released on May 12. This keeps the inflation landscape complex—despite the slowdown in monthly pace and stable core inflation, overall CPI is still expected to accelerate again.
For risk assets, this is not an ideal environment. A strong annual CPI reading could reinforce the Fed's difficulty in quickly cutting interest rates, often suppressing speculative trading like Bitcoin.
However, Bitcoin has previously avoided deeper pullbacks amid hotter CPI data. The March CPI report showed overall inflation rising from 2.4% in February to 3.3%, yet BTC prices instead increased by over 15%. One reason is that institutional buyers absorbed a volume equivalent to over 500% of the newly mined Bitcoin supply, with Strategy being a major player. But this support now appears to have weakened. Strategy has paused its BTC purchases, and its STRC preferred shares continue trading below the $100 face value. When STRC trades below face value, the efficiency of issuing new shares declines, limiting Strategy’s ability to raise new capital to buy more Bitcoin.
Analyst Killa said that large investors might start reducing risk exposure around the inflation report, citing a cautious pattern similar to that seen before the 2025 CPI event. He stated: “The key level to hold is the weekly opening price of $78,600; if it fails, the next downside targets are $74,000 to $75,000.”
On the technical side, Bitcoin is forming a classic ascending wedge pattern on the daily chart, which is viewed as a bearish reversal. As of Sunday, BTC is moving toward the wedge’s apex, around $84,000, where the two trend lines converge. A break below this level could trigger a decline toward the measured target of around $70,000. Conversely, a breakout above the apex (which coincides with the 200-day EMA) could completely negate the bearish structure, with the next upside targets in the $90,000 to $95,000 range.
On May 10, Bitcoin may face weaker support when the US releases its inflation report next week, compared to the previous two CPI data releases, increasing the risk of a pullback to $70,000.
The latest Cleveland Fed inflation forecast estimates that April's CPI year-over-year rose to 3.56%, up from 3.3% in March; the expected monthly CPI is 0.45% (below 0.9%), with core CPI at 2.56% YoY and 0.21% MoM (previously 2.6% and 0.2%). The official April CPI report will be released on May 12. This keeps the inflation outlook complex—despite a slowdown in monthly pace and roughly stable core inflation, overall CPI is still expected to accelerate again.
For risk assets, this is not an ideal environment. A strong annual CPI reading could reinforce the Fed's difficulty in quickly cutting rates, often suppressing speculative trading like Bitcoin.
However, Bitcoin has previously avoided deeper declines amid hotter CPI data. The March CPI report showed overall inflation rising from 2.4% in February to 3.3%, yet BTC price actually increased by over 15%. One reason is that institutional buyers absorbed a volume equivalent to over 500% of the newly mined Bitcoin supply, with Strategy being a major player. But this support now appears to have weakened. Strategy has paused its BTC purchases, and its STRC preferred shares continue trading below the $100 face value. When STRC trades below face value, the efficiency of issuing new shares declines, limiting Strategy's ability to raise new capital to buy more Bitcoin.
Analyst Killa said that large investors might start reducing risk exposure around the inflation report, citing a cautious pattern similar to the CPI events before 2025. He stated: "The key level to hold is the weekly opening price of $78,600; if it breaks, the next downside targets are $74,000 to $75,000."
On the technical side, Bitcoin is forming a classic ascending wedge pattern on the daily chart, which is viewed as a bearish reversal. As of Sunday, BTC is rising toward the wedge's apex, around $84,000, where the two trend lines converge. A break below this level could trigger a decline toward the measured target of around $70,000. Conversely, a breakout above the apex (which coincides with the 200-day EMA) could completely negate the bearish structure, with the next upside targets in the $90,000 to $95,000 range.