Bitcoin price drops to $70k as hot PPI data and Powell’s speech cast doubt on rate cut

Bitcoin price erased all of its gains from this week as it crashed to a key support level amid hotter-than-expected PPI data and Jerome Powell’s Federal Reserve speech that cast a shadow over any interest rate cuts this year.

According to data from crypto.news, the price of Bitcoin (BTC) fell more than 5% from its Wednesday high of $74,700 to an intraday low of about $70,660 on Thursday, March 19. The leading cryptocurrency was hovering around $70,879, down 27% from its year-to-date high of $97,538.

The global crypto market fell around Bitcoin to $2.51 trillion, down 3.8% during the day, as major crypto assets like Ethereum (ETH), XRP (XRP), Solana (SOL), and Dogecoin (DOGE) mirrored Bitcoin’s move.

The price of Bitcoin fell as new macroeconomic concerns dampened appetite among investors. This followed after US PPI data came in hotter than expected in February, with core PPI rising to 3.9% while headline PPI rose to 3.4%, beating market estimates of 3.0%.

Hot readings generally indicate that retail inflation is not cooling as quickly as expected, which could result in higher consumer prices.

The inflation data weighed heavily on sentiment as investors were already cautious ahead of Powell’s scheduled speech later in the day. The likelihood of a rate cut has fallen sharply, with markets pricing in a near-certainty pause ahead of the FOMC meeting.

The Federal Reserve’s speech also weighed on the market as Powell reiterated that the Fed will continue to hold interest rates while maintaining an entirely data-driven approach. He attributed this to rising energy prices caused by Middle East tensions, which have kept inflation high, with headline PCE around 2.8% and core inflation near 3.0%, both of which remain above the Fed’s 2% target.

While the market was already expecting a temporary suspension, the latest hawkish signals drove away investors who retreated due to fears of a further delay in easing.

At the time, the sharp decline in the price of Bitcoin caused a recession in all the markets used as long positions could not be held. Data from CoinGlass shows that the overall crypto market faced $455 million in liquidations, with $382 million removed from long positions. Bitcoin alone accounted for more than $150 million in total clearing.

The price of Bitcoin fell close to the support of $ 70,000, level analysts identified as the main psychological and technical base.

A few positive signs from technical indicators seem to point to a potential rebound that may be underway. Notably, the Supertrend indicator has turned green. If this metric shows a green signal, it means that the overall trend has changed from bearish to bullish, it usually serves as a buy signal for bullish traders.

At the same time, the MACD, which measures the relationship between two moving averages of a security’s value, also pointed higher, suggesting that the downward pressure is worrying and that a bullish crossover may be imminent.

Currently, the immediate resistance to look at is $72,540, the upper boundary of the Supertrend. A break above it could push Bitcoin’s price above $74,500, a level that corresponds to the Fibonacci retracement level of 38.2%.

On the contrary, if Bitcoin falls below the support of $70,000, a revisit to $65,000 and later to $60,000 becomes a distinct possibility as the next major areas to spend money.