A key economic measure from the US Federal Reserve (fed) showed inflation fell to its lowest annual rate in more than three years in May.
According to report The U.S. Commerce Department’s core personal consumption expenditures (PCE) price index rose just a seasonally adjusted 0.1% for the month and was up 2.6% from a year ago — down 0.2 percentage points from April.
Both numbers are in line with Dow Jones estimates. May marked the lowest annual inflation since March 2021, the first time this economic cycle that inflation was near the Fed’s 2% target.
Source: US Bureau of Economic Analysis
Including food and energy, inflation was steady in May and also increased 2.6% year-on-year, in line with expectations.
In addition to the inflation numbers, the Bureau of Economic Analysis report showed personal income rose 0.5% in the month, stronger than the 0.4% estimate. However, consumer spending increased by 0.2%, weaker than the forecast of 0.3%.
Prices were in check during the month thanks to a 0.4% fall in goods and a 2.1% fall in energy, offset by a 0.2% rise in services and a 0.1% rise in services. for food.
However, housing prices continued to rise, increasing 0.4% for the fourth consecutive month. Housing-related costs have been more persistent than Fed officials expected, and have contributed to the central bank not cutting interest rates as expected this year.
After the data was released, Bitcoin price fell slightly by 0.5% and is trading at $61,421.
Source: TradingView
VanEck Director of Digital Assets, Matthew Sigel, said Recent indicators are making him bullish on BTC, including:
Realized Losses – This index measures the difference between the buying and selling prices of Bitcoin investors. Sigel noted that short-term holders sold at a loss of more than $500 million – marking one of the five highest points in Bitcoin history for realized losses from this group of investors. High realized losses could indicate capitulation or panic selling, which could herald a bullish reversal as traders exit the market.
Volatility – Price volatility): Sigel noted that Bitcoin’s price volatility has reached 21, which is the 30-day annualized volatility (VA). A volatility of 21 is considered quite low for Bitcoin. Periods of low volatility often precede strong price movements. This suggests that the market may be stabilizing or consolidating, which could set the stage for a strong breakout.
Drawdown – Drop from ATH: This is Bitcoin’s price drop from its recent peak of $73,737, reached in March of this year. Understanding the magnitude of this decline helps gauge market sentiment and potential support and resistance levels.
These indicators show that there are potentially bullish signals for Bitcoin in Sigel’s opinion. High realized losses from short-term investors, combined with low price volatility and a significant decline from ATH, could suggest that Bitcoin may be approaching a recovery or consolidation point before the start of a trend. new price increase direction.
Itadori
Bitcoin Magazine
