The beginning of July was not bullish for Bitcoin and cryptocurrencies as previously expected due to a series of events that shook the market. For example, Spot Ethereum ETFs did not debut on July 2 as expected, and the US and German governments reportedly sold enormous tranches of BTC. However, Bitcoin and cryptocurrencies in general could be in for a turnaround as CPI data is expected to drop on July 11.

CPI data could change the narrative on cryptocurrencies

CrypNuevo Cryptocurrency Analyst Addresses X (formerly Twitter) participation their thoughts on where they think Bitcoin price will head next. Pointing to the upcoming CPI data, CrypNuevo explains that an interest rate cut could be imminent in the CPI data due out on Thursday, July 11.

Given that inflation data is expected to be lower, this could point to an immediate rate cut or at least a further rate cut by the Fed in the future. Naturally, such rate cuts would be good for the Bitcoin price, as they have been in the past.

“A rate cut or an announcement of an imminent rate cut would be very well-received in the cryptocurrency market and I believe prices would rise aggressively in such a case,” the analyst said. “I wouldn’t rule out that if we get a good CPI on Thursday, we could see a trend reversal that day as the market tends to price in what’s coming from the Fed,” CrypNuevo explained further.

Will Bitcoin’s downtrend continue?

For the analysis, the crypto analyst used the BTC 1-Day chart, which showed a rather peculiar wick that the analysis expects to fill. This wick is the $53,400 wick that appeared in early July before the market rebound, but the analyst does not believe that this is the end for the price. First, the analyst expects at least 50% of the wick to be filled, which already happened over the weekend when the price fell to $54,000.

Coming back to the topic of the 100% filled wick, this could be bullish for the price as the crypto analyst expects that a drop to this level could trigger a price rebound. However, there is also a possibility that the price will fill this wick and then drop even further.

In such a case, the crypto analyst believes that Bitcoin price would hold at $51,700. This would mean that this would be the next support level that bulls would hold. A rebound from this level would likely see the price rally towards $60,000, but the analyst maintains that $60,000 is now resistance for Bitcoin.

Featured image created with Dall.E, chart from Tradingview.com