Bitcoin's price movement today is largely influenced by the anticipation of a potential rate hike from the Bank of Japan (BoJ) and the recent U.S. Consumer Price Index (CPI) data. The market is currently pricing in a 90% chance of a BoJ rate hike on January 24, which has historically caused volatility in both traditional and digital asset markets. This anticipation has led to cautious trading, as investors brace for possible sell-offs similar to those seen in previous rate hikes. Additionally, the recent U.S. CPI data, which showed a slower-than-expected pace of core inflation, initially boosted Bitcoin's price, but the momentum has since waned as traders await further economic indicators.
The recent survey revealing that over 50% of Americans have sold gold and stocks to buy Bitcoin highlights the growing confidence in cryptocurrencies as a preferred investment. However, the potential for increased volatility due to upcoming U.S. retail sales data and political events, such as Donald Trump's inauguration, is causing some investors to adopt a more conservative approach. Jag Kooner, Head of Derivatives at Bitfinex, noted, "Markets typically see heightened volatility around major political events, and Trump's upcoming inauguration could spark short-term price swings for Bitcoin."
Bitcoin's price has experienced a 2.40% decrease today, currently trading at $98,092.92. The cryptocurrency reached a high of $100,540.55 earlier in the day but has since pulled back.