Why did Bitcoin rise today? CPI met expectations, and the Federal Reserve confirmed no change in policy

The U.S. Bureau of Labor Statistics released the February Consumer Price Index (CPI) on Wednesday, which fully met market expectations: overall CPI increased by 0.3% month-over-month and 2.4% year-over-year. Following the data release, Bitcoin’s price regained stability near the $70,000 level. This “no surprises” inflation report has deepened market expectations that the Federal Reserve will keep interest rates unchanged at next week’s Federal Open Market Committee (FOMC) meeting, providing a brief respite for risk assets.

Dual Significance of CPI Meeting Expectations: Market Interpretation of Inflation Path and Monetary Policy

The core logic behind Bitcoin’s rise today lies in the positive market sentiment generated by the CPI data “not having negative surprises.” BlackRock Chief Investment Strategist Gargi Chaudhuri pointed out that overall price pressures are generally easing, and core inflation is moving in a positive direction, sending encouraging signals; however, she also warned that rising gasoline prices indicate energy remains a significant factor influencing overall inflation.

For the cryptocurrency market, CPI data meeting expectations means reduced uncertainty regarding the Fed’s interest rate decision next week—markets widely anticipate rates will remain steady, which in the short term supports risk appetite. Interest rate expectations play a crucial role in Bitcoin pricing: stable or declining rate expectations typically favor liquidity conditions, thereby supporting demand for risk assets.

It is worth noting that this CPI report’s statistical cutoff date predates the U.S.-Iran military actions, so it does not reflect the potential inflationary pressures from the subsequent sharp rise in oil prices. The market has already identified “energy shock transmission lag” as a primary risk factor for inflation data in the coming months.

Special Rebound Under Iran Conflict: Market Logic Amid Multiple Pressures

Interestingly, Bitcoin’s rebound today occurred against the backdrop of overall pressure in global markets—Dow Jones plunged over 500 points, WTI crude oil surged more than 4% after the International Energy Agency (IEA) announced the largest-ever release of 400 million barrels from reserves, and the US dollar continued to strengthen. In this environment, Bitcoin’s recovery reflects its complex nature as a “macro sentiment-sensitive asset”:

Bullish Factors: CPI in line with expectations → Increased certainty of Fed pausing rate cuts → Clear short-term interest rate path → Slight risk appetite rebound

Bearish Pressures: Oil prices soaring → Potential re-acceleration of inflation → Long-term risk of the Fed maintaining high interest rates → Liquidity environment under pressure

Geopolitical Impact: Iran situation keeps markets cautious, making it difficult for Bitcoin to break through key technical resistance levels

Technical Analysis: $72,000 Resistance as the Key Breakthrough Level

(Source: Trading View)

From the chart structure, Bitcoin has established an upward trendline since the low of $60,000 at the beginning of the year, continuously forming higher lows. However, the resistance level around $72,000 remains a critical obstacle preventing further upward movement—Bitcoin has attempted multiple times to break through but has failed to sustain gains.

Currently, Bitcoin is holding above the ascending support trendline. If the bulls can eventually break and close above $72,000, the downside targets are $80,000, $84,000, and if momentum continues, possibly $90,000. On the downside, $64,000 is a key support—corresponding to the trendline from $60,000. A break below this level would pose a substantial threat to the overall bullish structure.

FAQs

Why did Bitcoin rise today while US stocks declined?
This divergence is a noteworthy phenomenon in the current market. The decline in US stocks mainly reflects concerns over soaring energy costs and deteriorating corporate earnings outlooks, while Bitcoin’s slight rebound is more directly driven by short-term sentiment improvement from the CPI meeting expectations. Although Bitcoin and stocks are usually highly correlated, they can temporarily diverge during specific events, especially when Bitcoin’s rise is more influenced by liquidity expectations than overall risk appetite.

How does CPI data influence the Fed’s decision next week?
Since February’s CPI fully met market expectations without any “unexpected upside,” market expectations that the Fed will keep rates steady next week have become more certain. Short-term interest rate uncertainty has decreased, which is a positive signal for risk assets like Bitcoin. However, because this report does not include oil price impacts following the Iran conflict, Fed officials will need to assess additional factors related to energy price surges when interpreting future inflation trajectories.

Why is the $72,000 resistance level so critical?
$72,000 is a key resistance zone where Bitcoin has repeatedly attempted to break through but failed, forming a historically significant supply concentration area. In this zone, previous high-position holders tend to sell when prices recover to their cost basis, creating persistent selling pressure. Only with a significant increase in trading volume can bulls effectively “absorb” this supply and confirm a genuine breakout.