Key insights
- BTC is up by less than 1% and is trading above $87,000.
- The market is bracing for the release of CPI data in a few hours.
Bitcoin trades above $87,000
The cryptocurrency market has been uneven since the start of the week, with most coins and tokens currently in the red. Bitcoin is trading around $87,000 after slipping below the psychological $90,000 level earlier this week.
The downturn comes ahead of the U.S. CPI release scheduled for later today. November’s U.S. inflation report, expected to show a 3.1% rise in the CPI, could influence the Federal Reserve’s interest-rate decisions.
With October’s CPI delayed due to the government shutdown, the November report will give investors a fresh read on price pressures.
Some analysts remain cautiously optimistic that Bitcoin may see a short-term relief bounce. Nick Forster, founder of on-chain options platform Derive.xyz, noted that
“BTC’s positioning remains clearly skewed to the downside. 30-day BTC volatility has risen back toward 45%, while skew sits around -5%. Long-term skew is also anchored near -5%, signaling that traders are pricing in continued downside risk through Q1 and Q2 as ongoing selling pressure from previously dormant wallets weighs on spot prices.”
Forster added that the probability of BTC reaching $100,000 is close to 30%, while the chance of reclaiming all-time highs is around 10%.
BTC risks a deeper correction
The BTC/USD 4-hour chart is bearish and effective, reflecting Bitcoin’s underperformance in recent days. The downward move followed a rejection from a descending trendline on Friday, and the asset has lost roughly 7% since then.
The leading cryptocurrency retested support at $85,000 on Wednesday but has bounced and is now trading above $87,000 per coin.
If the correction resumes and Bitcoin closes daily candles below the $85,569 support, it could extend the decline toward the psychological $80,000 level.
The daily Relative Strength Index (RSI) sits at 41, below its neutral 50 level, indicating growing downward momentum. Additionally, the Moving Average Convergence Divergence (MACD) lines remain in bearish territory.
However, if BTC recovers and closes above $85,569, it could resume its ascent toward resistance near $94,253.