How Bitcoin is related to inflation - Aspire Now Global

BTC UPDATE

For the news we were waiting for, the U.S. Bureau of Labor Statistics reported today that over the last 12 months, the all-items index increased 7.0 percent before seasonal adjustment which was predicted to be 7.1%. The fall which was to be a factor in because of the high inflation rate is already done. And anything less than the prediction was good and so we saw some recovery in the market yesterday.

To enter a bull market, we still need to reclaim $46,000 mark until then the market is indecisive. Also, after reaching $46,000 we may see some profit booking by small traders and after which we may see a good rally in the market.

What is Inflation and What is its Impact on Cryptocurrencies

Inflation is the gradual loss of a currency's buying value over time. The increase in the average price level of a basket of selected goods and services in an economy over time may be used to calculate a quantitative estimate of the pace at which buying power declines. A rise in the overall level of prices, which is frequently stated as a percentage, signifies that a unit of money now buys less than it did previously.

Now, as actual inflation rates come out to be lower than predicted 7.1%, so markets may eventually recover as it will be a boost for the economy as buying capacity of an individual will increase.

As market factors in everything, we have seen an immediate impact on Cryptocurrencies. As inflation rates have come out to be lower than expected, markets will turn green and we may see Bitcoin breaking its immediate resistance of $ 46,000. After this zone, we may see good buying volumes as RSI is also supporting the levels of the oversold region. With push-in Bitcoin, we may also see other alts to recover from their current lows.

To conclude, it’s difficult to say anything as of now for the short-term, but Bitcoin has already dropped too much from its record highs, insofar that it now stands technically oversold. But, as we know death cross is also heading its way in Daily TF, this may factor in and there may be panic sell in the market after which we may see 30k levels also.

Lastly, since we are printing all these dollars, then that means that the dollar has to depreciate a lot relative to crypto because of the limited supply. Therefore, the price of crypto currencies should rise over time. From the table below as we can see inflation is rising continuously, we can also consider it as a hedge to inflation. So, there is green signal for long term investors.

Table – Actual and Forecasted Inflation Data

To get the best advantage of this pump individual needs to get a clear idea of analytical skills, problem-solving skills and risk management where cryptocurrency courses will help to get a better understanding.