(Kitco News) – Crypto investors who anticipated volatility leading into the Bitcoin (BTC) halving have been proven right as this week has seen the top crypto spike to a high of $72,800 on Monday and fall to a low of $67,480 on Wednesday morning, only to climb back above support at $69,400, where it traded over the weekend. 

Stocks tumbled out of the gate and remained underwater throughout the trading day due to a hotter-than-expected March Consumer Price Index (CPI) reading, which showed that inflation continues to be a pain point for U.S. consumers. This was the third consecutive CPI reading to come in above expectations, leading investors to lower their expectations for an interest rate cut by the Fed, which weighed heavily on asset prices. 

At the closing bell, the S&P, Dow, and Nasdaq were all in the red, finishing down 0.95%, 1.09%, and 0.84%, respectively. Further complicating matters for stocks, gold, and crypto was a 1.2% spike in the DXY to a high of 105.306, while the yield on the U.S. 10-year Treasury climbed 470 bps to 4.556%.  

Data provided by TradingView shows that after falling from support near $69,400 and hitting a low of $67,480 in response to the CPI report, bulls took charge of the price action in the afternoon and pushed Bitcoin to an intraday high of $70,130, and look as though they intend to continue to charge higher. 

BTC/USD Chart by TradingView

At the time of writing, Bitcoin trades at $69,960, an increase of 1.2% on the 24-hour chart. 

New all-time high on the horizon

“Bitcoin has seen a sharp decline, shedding over 7% from its Monday peak at noon EST, particularly after an underwhelming CPI report led to a brief market downturn before it rallied,” said analysts at Secure Digital Markets. “Our established support at $67,500 holds strong; however, dipping below this threshold could herald a downward trend toward $66,000.”

“Despite not breaking out from the symmetrical triangle formation as anticipated, Bitcoin’s position above the 50-day moving average fuels our optimism for reaching new all-time highs soon,” they said. 

On the Bitcoin ETF front, the analysts highlighted that “there’s been a notable pullback with net outflows reaching $18.7 million, alongside continued substantial outflows from Grayscale amounting to $159.4 million,” but said additional demand could soon come from other sources. 

“Hong Kong is on the brink of green-lighting the inaugural batch of spot Bitcoin ETF applications, potentially rolling them out for trading come April,” they noted. “This positions Hong Kong and Australia at the forefront in Asia, ready to debut spot Bitcoin ETFs, while Singapore and the UAE appear to lag in immediate prospects.”

Addressing the broader markets, the analysts said “The financial landscape was jolted mid-week as stock futures plummeted, reacting to March’s inflation data surpassing forecasts.”

“The inflation acceleration in March suggests a persistent high-inflation environment, likely influencing the Federal Reserve to maintain its current interest rate stance,” they said. “Contrary to prior expectations of rate cuts commencing in June, the market consensus has now adjusted, delaying the anticipated reduction to September.”

“In the tech sphere, Nvidia finds itself in a correction phase after a 10% fall from its highs, despite riding the wave of heightened demand within the AI sector,” they added. “This adjustment underscores the volatile nature of tech stocks, even against a backdrop of significant sectoral growth.”

With Bitcoin now eight days from halving, Secure Digital Markets said $74,000 is the main resistance level to keep an eye on while $67,500 provides a firm level of support.

According to market analyst ElonTrades, the volatility and consolidation for Bitcoin over the past month “is the quiet before the storm,” and soon, its price will resume climbing higher. 

This is just the pre-halving quiet before the storm.

Halving scheduled to happen in about 10 days.

Some time after $BTC will push past $100k and your alts will 100x, it’s programmed.

— ElonTrades (@ElonTrades) April 10, 2024

Mixed day for the altcoin market

Altcoins suffered notable losses in the wake of the CPI report, but many managed to reverse course as the day progressed, leading to an overall mixed performance, with losers in the majority. 

Daily cryptocurrency market performance. Source: Coin360

Memecoin (MEME) led the winners with an increase of 15.7%, followed by a gain of 14.4% for Ethena (ENA), and an increase of 12.9% for cat in a dogs world (MEW). 

Uniswap (UNI) led the losers with a decline of 10% after the Securities and Exchange Commission (SEC) sent Uniswap Labs a Wells Notice indicating it will soon face a lawsuit. Other notable declines include Theta Fuel (TFUEL), which fell 9%, and Axelar (AXL), which lost 8.5%.  

The overall cryptocurrency market cap now stands at $2.6 trillion, and Bitcoin’s dominance rate is 52.7%.