US inflation data is released, Bitcoin pulls back - can it break through the $100,000 mark?
As soon as the US inflation data came out, Bitcoin immediately pulled back. Now, everyone is wondering if Bitcoin can still rise to $100,000?
You see, on November 14, the US inflation data was a little higher than everyone expected, and the S&P 500 index futures also fell 4.1%. In just four hours, it fell from 6023 points to 5980 points.
Traders are now wondering, when will Bitcoin's inflation hedging properties be able to protect everyone in an environment where inflation has been so high?
Although the US producer price index rose by 2.4% in October, a little higher than the expected 2.3%, everyone still thinks that the Federal Open Market Committee will have to cut interest rates by 0.25% in December. However, more and more people are beginning to doubt whether the Fed can continue to cut interest rates until 2025.
In the past, Bitcoin benefited from inflation. But in the past two years, the government has issued stimulus checks and expanded the Fed's balance sheet, and Bitcoin's ability to hedge inflation has weakened. At that time, although costs rose, the risk of economic recession was small. Now it is different. The labor market is still strong, but traders are cautious and feel that corporate profits are under pressure.
Although the new Trump administration has proposed a strategy of reducing costs and strengthening the dollar, these are not good news for risky assets in the short term. For example, there are reports that the United States may cancel the $7,500 tax credit for electric vehicles, and Tesla's stock price immediately fell by nearly 5%.
In addition, a new government agency was recently established, with Elon Musk and Vivek Ramaswamy as the head, saying that it is to streamline the bureaucracy and reorganize federal agencies. This may cause many people to lose their jobs, and individuals and companies will have less money to invest. The stock market will be affected by this, and housing, commodities, and Bitcoin will not be spared.
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