Bitcoin experienced a notable surge on Thursday, propelled by a decline in the value of the dollar following softer-than-expected consumer inflation readings for April. Despite remaining within a comfortable trading range, the cryptocurrency climbed 4% over the past 24 hours, reaching $66,264.2 by 08:54 ET (12:54 GMT). Although it briefly touched $66,700, it later moderated its upward momentum.
The rebound in Bitcoin‘s price followed a recent dip to $60,000 earlier in the week, primarily driven by a weakening dollar. The greenback saw a slide to one-month lows following the release of subdued consumer price index (CPI) figures for April. Both headline CPI and core CPI grew at a slower pace than anticipated, accompanied by weaker-than-expected retail sales data. These factors fueled speculation that inflation might ease in the coming months, potentially prompting the Federal Reserve to consider trimming interest rates.
However, concerns persisted as inflation remained elevated above the central bank’s 2% target range, with several Fed officials cautioning against premature rate adjustments. Consequently, Bitcoin’s gains were tempered, and the cryptocurrency continued to trade comfortably within the $60,000 to $70,000 range established over the past two months. Despite increased risk appetite evidenced by record highs on Wall Street, the positive sentiment did not significantly spill over into the crypto market.
Moreover, the looming threat of regulatory scrutiny cast a shadow over crypto markets, with reports indicating heightened regulatory action by the Securities and Exchange Commission (SEC) against the sector.
Bitcoin’s range-bound performance coincided with stagnant capital flows and trading activity in spot exchange-traded funds (ETFs), which had been instrumental in driving its rally in March.
Bullish Momentum Propels Bitcoin Towards $74K
Amidst the backdrop of soft inflation figures and growing institutional demand, bullish sentiment is on the rise, with Bitcoin poised to potentially reach $74,000 in the coming days. According to analysts at Singapore-based crypto asset trading firm QCP Capital, the recent breakout for BTC, coupled with institutional demand, could propel the cryptocurrency towards reclaiming its March record of $73,700.
Institutional interest in Bitcoin is intensifying, with large asset managers such as Millennium Management and Schonfeld allocating significant portions of their assets under management (AUM) to BTC spot ETFs. Notably, filings revealed that prominent funds like Millennium Management and Elliott Capital held millions worth of bitcoin exchange-traded funds (ETFs) in their portfolios.
Moreover, easing selling pressure on Bitcoin, evidenced by on-chain and exchange data, further bolsters the bullish outlook for the cryptocurrency.
Altcoins Rally with Some Struggling to Surpass March Highs
In addition to Bitcoin’s surge, major altcoins witnessed sharp gains on Thursday. Ethereum, the world’s second-largest cryptocurrency, rose by 1.4%, while XRP saw a 2.2% increase. Solana emerged as a standout performer, surging 9.5% to an over one-month high. However, despite the rally, many tokens remained below their highs reached in March, when they followed Bitcoin’s upward trajectory.
