Market leader Bitcoin is currently testing the $67,000 support level after rising as high as $70,000 at the beginning of the week. Behind this decline lies investors’ concerns about inflation data. A higher than expected inflation data may negatively affect the Bitcoin price by reducing risk appetite in the market.

Analysts point out that popular “meme coins” played a leading role in the declines experienced in the last 24 hours. Dogecoin (DOGE) and Shiba Inu (SHIB) dragged the market down, losing approximately 5% in value. XRP, Solana’s SOL, and BNB Chain’s BNB followed this decline with losses of 2%.

Trading desk experts at the Japanese cryptocurrency exchange bitBank state that in addition to the hesitant approach of investors, stronger than expected consumer confidence and weak bond sales by the US Treasury Department also put pressure on the Bitcoin price. “The price is not expected to show a clear direction until Friday. PCE data could be the breaking point for Bitcoin. If the data comes in higher than expectations, Bitcoin could lose half of its gains in the last two weeks and fall to the $65,000 level,” bitBank said in an email. says.

FxPro senior market analyst Alex Kuptsikevich expresses similar views. Kuptsikevich said in an interview on Telegram, “In the worst-case scenario, the price may drop to $60,000. In a more optimistic scenario, a drop to the $65,000 region, where the 50-day moving average is located, can be expected.” says.

However, despite this decline, on-chain analysis company Glassnode emphasizes that it has recorded signs of recovery in purchasing interest in Bitcoin. Long-term investors who have held Bitcoin for more than 155 days have restarted accumulation for the first time since December 2023 after months of selling. This indicates that long-term investors maintain their confidence in the future of Bitcoin.

This volatility of the cryptocurrency market also parallels the situation in traditional exchanges. Investors are also cautious in traditional stock markets, thinking inflation data will give clues about the Federal Reserve’s interest rate policy. Historically, high interest rates can reduce liquidity in the market, leading investors to sell across all asset classes.

In summary, US inflation data is of critical importance for the cryptocurrency market. Higher-than-expected inflation data may create selling pressure on many cryptocurrencies, especially Bitcoin. However, the fact that long-term investors have started saving again shows that an optimistic trend continues in the market. Inflation data to be announced on Friday will be one of the most important factors that will determine the direction of the cryptocurrency market in the coming days.