Bitcoin pushed above $85,000 after August's core PCE inflation reading came in cooler than expected, easing worries about another Fed rate hike. The gain stalled at the same ceiling that has capped the price all week, leaving the technical picture bullish but unresolved.
Bitcoin is doing something Wall Street can't right now: staying calm.
The Federal Reserve's preferred inflation gauge, the PCE index, rose 0.3% in August and 3.4% from a year earlier, below the 0.4% and 3.7% economists expected. Core PCE, which strips out volatile food and energy prices, rose 0.2% on the month and 3.0% annually, against forecasts of 0.3% and 3.3%.
Bitcoin reacted, pushing above $85,000 to a high of $85,598.94 before easing back to $84,376.09. The total market capitalization of the crypto ecosystem is up 0.6%, just below $3 trillion.
Rate-hike odds fall after the data
The cooler print changed the October conversation. CME's FedWatch tool now shows a 62% chance the Fed holds rates and a 37% chance of a 25-basis-point hike. Rate hike bets had already been fading, which bodes well for risk assets, since higher rates typically strengthen the dollar and lift returns on cash and bonds while lower rates tend to increase market liquidity flowing into assets like Bitcoin.
Still, cool is relative: 3.0% core inflation remains well above the Fed's 2% target. The 10-year Treasury yield hit around 5.25% on Tuesday, its highest level since 2002, while the S&P 500 lost 0.2% to 7,670.84.
Bitcoin price: a rocket, then a breather
Today's daily candle opened at $83,624.30, touched a high of $85,598.94 and corrected to its current price of $84,376.09, up $751.62 or 0.9%. That's a pause after a vertical run: Bitcoin dipped below $75,000 in mid-September, then exploded after a record ETF inflow day on September 21 and a wave of short liquidations sent it to $87,354, its highest price since January. Over the past week it has bounced in a tight band between roughly $82,600 and $85,600.
The Average Directional Index, which measures trend strength regardless of direction, reads 41.9, well above the 25 threshold that confirms a real trend, with buyers steering. The 50-day exponential moving average sits at $77,809.88, above the 200-day EMA at $74,423.93, a bullish setup, though Bitcoin's current price is about 8% above the 50-day, a stretched gap that traders often expect to retest.
Momentum also points up: the Relative Strength Index sits at 63.4, showing buyers in control but not exhausted. Even so, on the Myriad prediction market, traders put just 7% odds on Bitcoin topping its $126,199 all-time high before 2027, and ETF inflows have faded since their $2.4 billion week.
Inflation fears are off the table for now, but the bond market's problem isn't. The post-PCE pop stalled at $85,599, the same ceiling that has capped Bitcoin all week — cool data gave bulls a catalyst, but not yet a breakout.
Source: Decrypt
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