Bitcoin fell below $74,000 on Tuesday after a hotter-than-expected U.S. inflation report. Analysts point to $73,000 as the level to watch, with a break risking a move toward $69,000.
A hotter-than-expected U.S. inflation report sent crypto prices lower Tuesday, with bitcoin falling below $74,000 as analysts warned of a potential slide below the $70,000 level.
October's Consumer Price Index rose 0.4%, above forecasts of 0.3%, while core CPI increased 0.3% against expectations of 0.2%. The figures raised concerns about the Federal Reserve's interest rate outlook.
Bitcoin tests the $73,000 level
Bitcoin was trading at $73,363, down 1.6%. Matt Mena, senior crypto research strategist at 21Shares, said the $73,000 level is particularly important because it sits near bitcoin's pre-election 2024 all-time high and its April 2025 lows.
A sustained break below that level could send BTC toward $69,000, which would put the cryptocurrency near its 2021 cycle high, Mena said. He also pointed to the 50-week moving average as an important technical support level, warning that a break could put further pressure on Ethereum's $2,000 support, with $1,800 the next level to watch.
Meanwhile, Bitget analyst Lewis Huang said higher yields and a stronger dollar could add to recent selling pressure. According to Huang: "The 200-day moving average near $73,200 is a key support level to watch."
Ether and Solana fall alongside bitcoin
Ether was down 3.7% to $2,042. Solana dropped more than 4% to trade below $83.
Upside case and a gradual drift lower
There is still a potential upside scenario if bitcoin holds $73,000 and equities continue to rebound. 21Shares sees BTC potentially retesting $78,000, with a move above that level putting $85,000 in reach by year-end.
Institutional participation and the growing use of derivatives could also influence bitcoin's volatility, according to Wincent senior director Paul Howard. Without a meaningful shift in monetary policy, regulatory clarity, or institutional capital flows, Howard said, bitcoin is more likely to experience a gradual downward drift than mount a sustained rally toward the $100,000 level previously anticipated.
Source: The Block
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