The BTC/USD pair held quite well as the US dollar index (DXY) retreated to $104.23, a few points below this month’s high of $105.5. This came even after the latest US consumer inflation data showed an increase from 0.2% to 0.6%, higher than the median estimate of 0.4%. As a result, inflation rose to 3.6%, marking its highest level in months.
High inflation is typically bearish for Bitcoin and other cryptocurrencies as it pushes the Federal Reserve to hike interest rates leading to better returns from safe assets like money market funds.
However, Bitcoin’s price has shown stability as investors react to the decision by Franklin Templeton to file for a Bitcoin ETF. The firm now joins Wall Street companies like Invesco and Fidelity that have filed for these funds, causing investors to anticipate that the SEC will approve one or more of these funds.
Technical analysis of the BTC/USD pair reveals that it has been in a tight range in recent days, rising from this week’s low of 24,940 to over 26,000. The pair moved slightly above the 25-period and 50-period moving averages while the Relative Strength Index (RSI) has moved to the neutral point of 50.
Analysts also suggested that if U.S. regulators approve a Bitcoin spot price exchange-traded fund (ETF) in the coming months, it could have a positive impact on the price.
Despite these developments, some traders caution that on-chain volume appears to be cooling down after a relief rally, indicating that the rally might be short-lived. However, BTC/USD is still holding the key $25,000 level.
In terms of Bitcoin’s performance in September, it was on track to be its best-performing September in years. The last time BTC/USD gained in September was in 2016 when it recorded a 6.35% increase. In contrast, it had a 3.1% loss in 2022 but rebounded with a 5.6% increase in October, informally known as “Uptober” among bullish investors.
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Source: Cryptocurrency - investing.com
