Bitcoin’s price could see significant volatility later today as the US releases its inflation data, which is expected to show a year-over-year increase of 2.6% for headline inflation, marking the first such rise since March 2024.
The US Consumer Price Index (CPI) due at 8:30 ET is expected to reveal that the cost of living has increased by this amount, ending a six-month streak of consecutive declines. This news has sparked concerns among investors, who are already seeing high levels of implied volatility in Bitcoin.
Implied volatility for options contracts expiring one week from today has jumped to as high as 90%, a significant increase from just over two weeks ago. Glassnode defines this measure of market expectation of volatility and is often influenced by realized volatility and market sentiment.
Historically, inflation data releases have brought downside volatility to Bitcoin in the past, particularly when inflation was running hot. However, with inflation slowing down throughout the year, the market has become more efficient, producing three consecutive 0-1% price movements. This trend may reverse if inflation is expected to rebound again.
As a result of the recent US presidential election and its impact on the cryptocurrency market, Bitcoin’s price surged to $90,000 earlier this month. However, with the current spike in implied volatility, some analysts are wondering whether the price could see a dramatic swing later today.
Source: https://www.coindesk.com/markets/2024/11/13/volatility-expected-in-bitcoin-later-today-as-us-headline-inflation-data-is-expected-to-tick-higher