Key Points
- Bitcoin’s price has increased above $63,000, with several factors potentially influencing its future trajectory.
- The Federal Reserve minutes, CPI data, and Q3 earnings could potentially drive further price gains.
Bitcoin’s price has seen a slight increase, now exceeding $63,000. This comes at the start of a new week filled with several narratives that could potentially impact the cryptocurrency’s price.
Over the past week, Bitcoin’s trading has been rangebound, fluctuating between $60,000 and $64,500. These erratic price movements reflect a state of market uncertainty.
Potential Price Drivers
Nevertheless, Bitcoin may be in for a turbulent week ahead, as trading volumes have surged by 55% at press time, according to CoinMarketCap. Furthermore, Bitcoin’s price has risen by 2.5% in the past 24 hours, now trading at $63,435.
The increased volumes and price gains suggest that traders may be buying into several narratives that could potentially drive prices this week. These include the Federal Reserve minutes, CPI data, and Q3 earnings.
Federal Reserve Minutes
The US Federal Reserve is expected to release its minutes for the September monetary policy meeting on October 9th. Last month, the Federal Reserve cut interest rates for the first time since 2020. The September minutes could provide insights into potential rate cuts during the November and December meetings.
September’s 50-basis point reduction played a role in propelling Bitcoin’s prices last month. Data from the CME FedWatch Tool shows that 97% of investors predict that the Fed will cut rates by 25 basis points in November.
A further reduction in interest rates could increase interest in risk assets like Bitcoin. Therefore, if the Fed minutes reveal a more dovish stance, it could boost Bitcoin’s gains.
CPI & PPI Data
The US inflation data for September is scheduled for release on October 10th. Markets predict that the annual inflation rate will stand at 2.3%, a decrease from the 2.5% reported in August.
Additionally, the Core Inflation Rate year-on-year is projected to cool down to 3.1%, a drop from the 3.2% reported in August.
The Producer Price Index (PPI), another predictor of inflation, will be released on October 11th. Economists forecast that the year-on-year PPI data will decrease from 1.7% to 1.3%.
If the inflation data meets expectations or falls below them, it could drive gains for Bitcoin. Conversely, if this data exceeds expectations, it could increase Bitcoin’s volatility and result in a price drop.
BlackRock’s Q3 Earnings
BlackRock, a $10 trillion asset manager and one of the issuers of spot Bitcoin and Ethereum exchange-traded funds (ETFs), will release its quarterly results this week.
BlackRock’s iShares Bitcoin Trust (IBIT) currently holds 367,000 BTC valued at $22 billion. Therefore, the strength of its Q3 earnings could influence prices.
JPMorgan will also release its Q3 results later this week, after which it will make 13-F filings with the US Securities and Exchange Commission (SEC) revealing its exposure to Bitcoin ETFs.
In Q2, JPMorgan’s 13-F filing revealed it held $760,000 worth of Bitcoin ETF shares. As the largest US bank, any change in its Bitcoin ETF holdings could drive volatility.
These three narratives are already influencing activity in the Bitcoin futures market. Bitcoin’s open interest has risen to the second-highest level this month to $34 million at press time per Coinglass.
This increase indicates that more traders are opening positions and participating in the market.