Why is Bitcoin price down today?

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Cointime2025/02/12 13:33

By:Cointime

From cointelegraph by Yashu Gola

Bitcoin’s price has dropped by over 2% in the last 24 hours to reach around $96,150 on Feb. 12.

Why is Bitcoin price down today? image 0

BTC/USD four-hour price chart. Source: TradingView

Key takeaways:

Bitcoin’s drawdown follows US Federal Reserve Chairman Jerome Powell’s hawkish remarks in the Senate Banking Committee hearing.
Traders are also de-risking ahead of a key US inflation print on Feb. 12.
Bitcoin price needs to hold above a key support area to avoid a deeper correction.

Hawkish Powell pressures Bitcoin, altcoins down

Bitcoin’s drop in the last 24 hours followed Powell’s outlook on interest rates going further in 2025.

Key takeaways from Powell’s speech.

No urgency to adjust interest rates, as inflation remains a concern.
Cutting rates too fast or too aggressively could undo progress in controlling inflation.
Delaying or reducing cuts too much might slow economic growth and impact jobs.

Market’s reaction after Powell’s statement.

Treasury bond yields stayed elevated, making traditional high-yield assets more attractive than riskier assets.

Why is Bitcoin price down today? image 1

US 2-year and 10-year Treasury note yield daily chart. Source: TradingView

Crypto markets pulled back, with Bitcoin and altcoins facing sell-offs.
CME FedWatch Tool sees 95.5% probability that rates stay unchanged at the March 19 meeting, up from 75.5% a month ago.

Why is Bitcoin price down today? image 2

Target rate probabilities for March 19 Fed meeting. Source: CME

A rate cut isn’t fully priced in until September 2025.
Fewer than two rate cuts expected for the entire year, limiting upside momentum for risk assets.

Traders de-risk ahead of inflation data

Bitcoin’s decline today appears ahead of the release of US consumer price index (CPI) report.

Things to know:

Inflation likely remained stubborn in January, according to a Bloomberg survey .
Economists expect core CPI (excluding food and energy) to rise 0.3% from December, based on estimates from the Bureau of Labor Statistics.
Year-over-year core CPI is projected to increase by 3.1%.

Why is Bitcoin price down today? image 3

US core inflation forecast. Source: Bloomberg

Core CPI has risen by 0.3% the fifth time in the last six months, signaling stalled progress in reducing inflation.
Higher-than-expected inflation data could support the Fed’s patient approach to maintaining higher interest rates, limiting liquidity in crypto markets.

Related: Easing inflation could ignite another BTC rally: 10x Research

Historical trends show that Bitcoin often experiences short-term sell-offs around CPI releases, followed by a sharp move in either direction once the data is out.

Why is Bitcoin price down today? image 4

BTC/USD daily price chart. Source: TradingView

Bitcoin price faces stiff resistance at 50-day EMA

Bitcoin’s drop today has appeared after testing its 50-day exponential moving average (50-day EMA; the red wave) at around $98,200 as resistance.

Key points:

Bitcoin has continuously attempted to rise above the 50-day EMA since Feb. 5, failing every time.
The 50-day EMA aligns with the horizontal resistance level at around $98,000.

Why is Bitcoin price down today? image 5

BTC/USD daily price chart. Source: TradingView

Despite interim corrections, Bitcoin is treading inside a broader ascending triangle channel.
A clear break above the 50-day EMA resistance will likely push Bitcoin toward the triangle’s upper trendline at around $106,000.
Conversely, breaking below the trendline’s lower trendline could push BTC’s price toward $88,000, aligning with the 0.382 Fib retracement line.

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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