Bitcoin poised for significant movement as US CPI data approaches, with potential to exceed $120,000 or drop to $100,000.

Bitcoin is preparing for the upcoming release of the September US Consumer Price Index (CPI) on Oct. 24, marking the first significant data point since the federal shutdown commenced.

Analysts from The Kobeissi Letter highlighted the significance of this announcement, pointing out that it will be the first CPI release on a Friday since January 2018 and occurs just five days prior to the Federal Reserve’s meeting on Oct. 29.

Additionally, with the Labor Department pausing all other major data releases until the conclusion of the shutdown, this CPI report will serve as the Fed’s primary inflation indicator.

This exclusivity heightens the stakes as there will be no new jobs, payroll, or producer-price data to provide context.

Inflation forecast

The latest CPI report indicated US inflation at 2.9% in August, a slight increase from 2.7% in the previous month.

In light of this, economists at Wells Fargo now anticipate that September’s figure will rise modestly to 3.1%, remaining within a range that aligns with gradual disinflation. Core prices, which exclude food and energy, are expected to hold steady, indicating that inflationary pressures are easing but not eliminated.

Throughout financial markets, traders are already positioning themselves for possible policy easing. As per the CME FedWatch Tool, futures data suggest a 99% likelihood that the Fed will reduce rates at its Oct. 29 meeting and an 85% chance of another cut in December.

US Interest Rate Cut Possibility for Oct. 29. Source: (CME FedWatch)

Importantly, a softer CPI reading could likely bolster that outlook and weaken the dollar, while a hotter-than-expected figure might temporarily revive speculation regarding rate hikes.

Impact on Bitcoin

Kautious Data analysts noted that the CPI’s influence on cryptocurrency remains direct, as the current “thinner macro signals can create a near-term bullish scenario for crypto narratives while introducing tail risk for broader markets.”

The firm indicated that a softer core reading below 0.3% month-over-month would support a dovish perspective, putting pressure on the dollar and benefiting assets like gold, equities, and Bitcoin.

Conversely, a more persistent inflation result, especially if services and shelter exceed 0.4%, could strengthen the dollar and negatively impact risk assets.

The firm also pointed out that crypto markets frequently experience “pre-release rallies and post-print sell-the-news reactions” as volatility increases and funding shifts.

Meanwhile, Dean Chen, an analyst at digital-asset firm Bitunix, informed CryptoSlate that the market’s response will depend on how investors adjust their risk assessments following the release.

He mentioned that the market could maintain the current “high-for-longer but stable” narrative if the data aligns with expectations, allowing Bitcoin to continue consolidating near its recent peaks.

However, a stronger core figure could elevate Treasury yields and the dollar, prompting a short-term correction from the upper range.

Furthermore, Chen noted that a cooler CPI could rejuvenate ETF inflows and push Bitcoin towards the $117,000-$120,000 range, while a hotter report might redirect capital to safer assets, testing support around $100,000.

He added:

“Traders should monitor real-time movements in US yields and the dollar following the release: a simultaneous increase in both would pressure Bitcoin, while a decline could rekindle risk appetite. In this context, volatility remains high, and the sustainability of ETF inflows will be crucial in determining whether Bitcoin can regain momentum post-data.”

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