Bitcoin [BTC] has recently experienced a notable surge in its value, crossing the $100k milestone. Currently, Bitcoin is trading at $102,048 after a substantial increase of more than 7% over the past week.
The surge in Bitcoin’s price has sparked discussions within the cryptocurrency community, with many speculating on the factors driving this growth. An analyst suggests that the recent Consumer Price Index (CPI) report may have played a crucial role in boosting market sentiment and fueling the cryptocurrency’s upward trajectory.
Bullish Momentum Driven by CPI Data
As per insights shared by CryptoQuant analyst Fost, the release of the CPI data triggered a surge in stablecoin inflows to Binance, amounting to $500 million. This influx of capital has had a positive impact on Bitcoin, propelling its price beyond the $100,000 mark.
Following the encouraging CPI inflation data release, market sentiment shifted favorably, evident in the increased stablecoin inflows to Binance.
Investors interpreted the news as a promising indicator that Bitcoin’s upward trend is likely to persist, leading to the substantial capital inflows observed on Binance.
Moreover, the majority of the funds flowing into Binance were utilized for purchasing Bitcoin, driving its price above the critical $100k level and resulting in a significant decrease in Bitcoin reserves on the exchange.
Since August 12, more than 63,000 Bitcoins have exited Binance’s reserves, underscoring investors’ strong confidence in Bitcoin’s current trajectory and their inclination towards long-term positioning.
Sustaining Growth Momentum
With positive inflation data reinforcing market optimism, Bitcoin appears poised for further growth, particularly as anticipation builds around the assumption of a crypto-friendly U.S. administration.
Given the prevailing market conditions, Bitcoin could continue to register gains in the near term.
Notably, Bitcoin’s Taker Buy Sell Ratio has surged in the past 3 days, currently standing at 1.116.
A ratio above 1 signifies dominance of buyers in the market, indicating that the recent price surge is being primarily driven by heightened demand.
Furthermore, there is a noticeable trend of buyers taking long positions, as evidenced by the escalating funding rate.
Bitcoin’s funding rate spiked to a monthly peak of 0.0247 in the last 24 hours, signaling bullish investor sentiment and expectations of further price appreciation.
Moreover, Bitcoin has become scarcer, as indicated by a rising stock-to-flow ratio. Scarcity often drives up the value of Bitcoin based on demand-supply dynamics. Increased scarcity suggests a growing number of holders opting to store their assets in personal wallets, reflecting an accumulation pattern.
In essence, the positive CPI data release has had a significant impact on Bitcoin’s price performance, leading investors to adopt a bullish stance and view the recent data as a positive signal for future market performance.
Given the prevailing bullish sentiment, Bitcoin could potentially reach $105,000. However, a correction might lead to a dip to $98,900.