Bitcoin pushed toward $79,000 yesterday following the release of US inflation data, recovering ground after testing support near $76,000 earlier in the session as investors navigated macroeconomic uncertainty ahead of the Federal Reserve's policy decision. The largest cryptocurrency by market capitalization has been trading in a choppy fashion all week, with sentiment swinging between optimism over cooling price pressures and anxiety about how aggressively the central bank might still tighten. According to the Bureau of Labor Statistics, annual inflation as measured by the Consumer Price Index held steady at 3.4% in August, matching the broad consensus and offering little in the way of a surprise. However, the details beneath the headline told a more complicated story. On a monthly basis, headline CPI accelerated 0.4%, a sharp pickup from July's 0.1% increase. Core CPI, which strips out volatile food and energy costs, rose 0.3% against expectations of 0.2%, though the annual core rate did ease to 2.4% from 2.5%. Those mixed signals have left the market in an uneasy position. While headline inflation appears contained, the monthly acceleration in both headline and core measures suggests underlying price pressures remain sticky, giving the Fed little reason to soften its stance. Traders have responded accordingly. According to the CME FedWatch tool, the probability of a hike to the 3.75%–4.00% range next Wednesday has jumped to 87%, up sharply from 72% a day earlier. That is a significant repricing in a single session and reflects growing conviction that the Fed will deliver another increase. For Bitcoin, the implication is twofold: tighter policy tends to weigh on risk assets by draining liquidity, but a Fed that is acting decisively on inflation may also signal confidence in the economy, which could support sentiment over the medium term.
Bitcoin is currently trading near $77,260, positioned below most key moving averages on the hourly chart while still holding well above the longer-term average on the four-hour timeframe. On the hourly chart, the 50-period average sits at $77,400, while the 200-period average rests higher at $78,950. Price is trading just beneath the 50-period average and well below the 200-period average, which suggests sellers have the near-term upper hand. A push back above $77,400 would be the first sign that buyers are regaining control, while reclaiming $78,950 would mark a more meaningful shift in momentum. On the four-hour chart, the 50-period average is positioned at $78,800 while the 200-period average sits considerably lower at $73,980. Price is trading below the 50-period average but comfortably above the 200-period average, a configuration that points to a short-term pullback within a broader constructive structure. The $78,800 level now functions as overhead resistance, while $73,980 provides a substantial safety net far below current price. Diverting to horizontal levels, the first resistance barrier sits at $78,000, a level that has repeatedly capped upside attempts. Beyond that, a supply zone stretches from $78,800 to $79,200, followed by a heavier hurdle at $80,000, a psychologically significant round number. Clearing those would expose $81,000 and $82,000. On the downside, initial support is found at $76,000, which held during Friday's dip. A break below would expose $75,200, then $74,500, with $73,980 aligning with the four-hour 200-period average as a deeper demand area. Looking ahead, if Bitcoin holds above $76,000 and reclaims the hourly 50-period average at $77,400, buyers could drive price toward $78,000 and beyond. Should selling pressure build and $76,000 give way, a deeper correction toward $75,200 and $74,500 becomes increasingly likely. The broader structure remains constructive so long as price stays above the four-hour 200-period average, but near-term direction will hinge on whether buyers can overcome hourly resistance and how markets digest the Fed's decision next week.
