#CryptoCPIWatch
Is there a relationship between inflation data (CPI) and cryptocurrency volatility?
#CryptoCPIWatch
Many new traders think that cryptocurrencies operate independently of the traditional economy, but the reality is quite different!
Every month, we eagerly await the Consumer Price Index (CPI) data because it simply moves the markets — not just stocks, but even Bitcoin, Ethereum, and small coins!
Why?
Because rising inflation pushes central banks to raise interest rates, causing liquidity to exit high-risk assets like crypto, and thus we witness a sudden drop in prices. The opposite is also true.
As a smart trader, here’s what you should watch:
CPI data release date (usually in the middle of the month)
Expectations compared to the actual reading
Reaction of the traditional market (gold, US dollar, stocks)
Movement of Bitcoin before and after the announcement
Tip:
Do not enter a large trade hours before CPI data. Wait, observe, then decide based on market direction.
