Bitcoin reaches new all-time high after soft CPI boosts rate cut bets

Bitcoin (BTC) reached a new all-time high on Wednesday, rising above $124,000, one month after establishing a record high in July, according to data from crypto exchange Binance. This marks the fourth time that the top crypto is establishing a record high in 2025. Analysts at Standard Chartered estimate Bitcoin could reach $200,000 by year's end if the current bullish momentum continues.

Bitcoin had earlier seen reduced volatility in the crypto options market last week, with altcoins leading most of the action. However, Glassnode analysts highlighted in a report on Tuesday that such periods of muted volatility expectations are a "contrarian indicator" and have frequently preceded sharp market swings, as can be seen in the rally over the past 24 hours.

BTC resumes bullish move as soft CPI ignites bullish appetite

Bitcoin's rally follows a soft US Consumer Price Index (CPI) print on Tuesday, which fueled hopes for a rate cut in the next Federal Open Market Committee (FOMC) meeting in September. Headline CPI for July came in lower than expected at 2.7% versus projections of 2.8%, according to the US Bureau of Labor Statistics (BLS).

Market participants have now priced in a 93% chance that the Federal Reserve (Fed) will begin cutting rates in September, according to the CME FedWatch tool.

Treasury Secretary Scott Bessent earlier called for a series of rate cuts on Wednesday, stating that the Fed should begin with a 50 basis point reduction next month.

Following the CPI print on Tuesday, President Trump continued his bashing of Fed Chair Jerome Powell, calling him "too late" and adding that he's considering a lawsuit against him.

The move has triggered a decline in the US Dollar Index (DXY), which has fallen by 0.7% to 97.6 over the past two days. This has caused a rise in risk assets, including Bitcoin and the S&P 500.

While the short-term move can be attributed to the decline in the DXY, Bitcoin has also been largely benefiting from the President Trump administration's favourable regulatory attitude toward the crypto industry. Trump signed the stablecoin-focused GENIUS Act in July, while the crypto market structure CLARITY Act passed the US House.

Since Trump's inauguration in January, Bitcoin has established new all-time highs on four separate occasions, with the latest coming just a month after posting a similar record.

BTC smashes $124,000, eyes $136,000 after bouncing off rising wedge support

Bitcoin has risen over 3% in the past 24 hours, stretching its weekly gains above 7%, with potential to hit $136,000 based on the Fibonacci Retracement. The uptrend comes after bouncing off the lower boundary of a rising wedge, strengthened by the 50-day Exponential Moving Average (EMA) and Simple Moving Average (SMA).

BTC/USDT daily chart

The Relative Strength Index (RSI) and Stochastic Oscillator (Stoch) are in their overbought regions, indicating heightened bullish momentum but with potential for a short-term pullback.