- Bitcoin volatility has fallen, reaching long-term lows, which is about as exciting as watching paint dry.
- U.S. inflation is predicted to rise amid growing concerns over Donald Trumpâs tariffs, because why not add a little drama to the mix?
Although Bitcoin [BTC] has recently rallied to hit a new all-time high, BTC volatility remains at historical low levels, which is about as thrilling as a Tuesday afternoon in a dentist’s office.
According to CryptoQuantâs analyst Axel Adler, Bitcoinâs volatility has dropped to 200 Average True Range (ATR) as investors await key U.S. inflation data. Itâs like everyoneâs holding their breath, waiting for the next big sneeze.
The drop to a 200 ATR level suggests that Bitcoinâs price movements are currently calm, with volatility reaching long-term lows. Itâs like the market is taking a nap, and no one wants to wake it up.
At these levels, the market appears to be in âwait and seeâ mode, as on-chain activity slows. Itâs like a game of chess where everyone is just moving the pawns back and forth, hoping the other guy makes a mistake.
Low volatility typically signals smaller, more stable price swings, and this often leads to reduced capital inflowâfrom both retail and institutional investorsâas many choose to stay on the sidelines. Itâs like a party where everyoneâs just standing around, waiting for someone to start the music.
This reduced momentum, indicated by Bitcoinâs Mean Coin Age, climbed steadily and sat at a yearly high of 1.617k, at press time. This indicating that coins are staying untouched as more investors shift toward HODLing. Itâs like everyoneâs decided to play the long game, even if it means sitting on their hands for a while.
As this holding trend strengthens, the Mean Coin dollar Age is approaching 18 million, further reinforcing the long-term sentiment. Itâs like a marathon where everyoneâs pacing themselves, knowing the finish line is still a long way off.
At the same time, investors are also reducing leverage, particularly in the futures market, signaling a more cautious and risk-averse approach as they sit tight and wait for clearer momentum. Itâs like a poker game where everyoneâs folding, waiting for the right hand to come along.
Why are investors taking a step back?
According to CryptoQuant, Bitcoin investors are currently in wait-and-watch mode ahead of the U.S. inflation data release. Itâs like theyâre all standing at the edge of a cliff, peering over to see if the ground is still there.
The Consumer Price Index (CPI) report from the Bureau of Labor Statistics is scheduled for release today, June 11, 2025. This announcement has sparked widespread speculation about the potential market impact. Itâs like a mystery novel where everyoneâs trying to guess the ending before theyâve even read the first chapter.
Reuters forecasts that CPI will rise by 0.2% for May, marking a 2.5% increase year-over-year. Meanwhile, Core CPIâwhich excludes food and energyâis expected to climb 0.3% for the month, with a 2.9% annual increase. Itâs like a weather report where everyoneâs hoping for a sunny day, but the forecast is looking a bit cloudy.
The upcoming CPI data may show an increase, partly due to Liberation Day tariffs imposed in April. Since many retailers had still been selling pre-tariff inventory, those earlier price hikes likely didnât affect Aprilâs figures. Itâs like a delayed reaction to a punchline that everyoneâs still trying to figure out.
Now, economists and retailers expect higher costs, especially for food and energy, potentially pushing prices to a four-month high. Itâs like a rollercoaster thatâs just starting to pick up speed, and everyoneâs holding on tight.
This CPI release is criticalâit could reshape the broader economic outlook, including the crypto market. Itâs like a key that could unlock a treasure chest, or a trapdoor that could send you plummeting into the abyss. You never know with these things.
If the reading comes in stronger than expected, it might cool investor sentiment and lower the chances of a near-term Federal Reserve rate cut. Itâs like a cold shower that wakes everyone up, but not in a good way.
If the CPI data comes in higher than expected, the Federal Reserve may keep interest rates elevated for a longer periodâa move thatâs typically bearish for Bitcoin. Higher rates tend to reduce market liquidity, strengthen the U.S. dollar, and raise yieldsâall of which can put downward pressure on BTC. In this scenario, Bitcoin could potentially pull back to around $107,000. Itâs like a seesaw thatâs tipping the wrong way, and everyoneâs scrambling to get off before they fall.
On the other hand, if the CPI reading is favorable, Bitcoinâs uptrend could continue, increasing the likelihood of a retest of its all-time high (ATH). Itâs like a rocket ship thatâs just starting to gain altitude, and everyoneâs hoping it doesnât run out of fuel before it reaches the stars.
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2025-06-12 05:18