- US inflation hit 6.3% as Bitcoin crosses previous all-time high and begins price discovery.
- Analysts argue that Bitcoin is likely to hit the end of year targets in the currency cycle as the Consumer Price Index rises.
- Bitcoin is considered a hedge against inflation; therefore, a rise in inflation influences capital rotation in Bitcoin.
Bitcoin enters price discovery as US inflation hits 6.3%. The benchmark cryptocurrency has hit a new all-time high as institutional capital continues to flow in Bitcoin.
Bitcoin price is on track to hit $100,000 at the end of 2021
Bitcoin has recovered from the drop below $60,000 over the past week and hit a new all-time high earlier today. Experts have noted a direct correlation between inflation in the United States and Bitcoin’s price.
Bitcoin entered price discovery as US inflation hit its highest point in 30 years, 6.3%. Experts consider Bitcoin a hedge against inflation; therefore, a rise in inflation implies capital rotation in BTC, triggering a price rally.
Historically, spikes in BTC prices correspond with a rise in US inflation.
Note to my trolls (assuming you can read)— Peter Brandt (@PeterLBrandt) November 10, 2021
Let me type this really slow so that you might understand -- I have only shorted cryptos once in my life (Nov 14, 2018)
I have been continually long $BTC since early Apr 2019. I want Bitcoin price to go UP (spelled U P)
Interestingly, in addition to acting as an inflation hedge, Bitcoin has an impact on monetary policy. A rise in inflation and a drop in the US employment rate encourages the Fed to tighten its policy. Therefore, inflation is considered as a key indicator of Bitcoin’s price trend and upcoming reversal.
The dropping BTC balance across spot exchanges is considered another indicator of a bull run. For the past 20 months, exchange BTC reserves have plunged, implying increased accumulation and a supply shortage.
Pseudonymous cryptocurrency analyst @CryptoCapo_ has evaluated the BTC price trend and believes that BTC price is rallying toward $100,000 in the ongoing bull run.
FXStreet analysts are of the opinion that Bitcoin has presented the most bullish setup of the year.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.