Bitcoin Tests Fibonacci Resistance Ahead of U.S. Inflation Report
Bitcoin (BTC) climbed to $122,171 early Monday, testing a key technical resistance level as traders awaited the latest U.S. inflation data.
The level in focus is the 1.618 Fibonacci extension, drawn from the 2018 and 2022 bear market lows—commonly known as the “golden ratio.” This metric is widely watched by technical analysts for its psychological and structural significance across financial markets.
This is the second attempt by bulls to breach the level. A previous breakout in July was short-lived, resulting in a correction back below $112,000. A confirmed move above $122K could open the door to further upside, with $140,000 emerging as a target based on Deribit option flows, where over $3 billion in open interest is concentrated at that strike.
However, failure to hold this level again may indicate waning bullish momentum and raise the likelihood of a deeper pullback.
Core CPI Expected to Tick Higher, Fed Rate Cut Still Anticipated
Market attention now turns to the U.S. Consumer Price Index (CPI) report due Tuesday. Consensus estimates forecast a 0.3% increase in core CPI for July—up from 0.2% in June—as new tariffs begin to filter through into consumer prices.
Despite the anticipated rise in inflation, analysts believe it’s unlikely to shift the Federal Reserve’s current trajectory toward a September rate cut.
“The dollar may resume its downtrend after the CPI release,” said Marc Chandler, Chief Market Strategist at Bannockburn Global Forex, adding that July’s soft jobs report significantly boosted expectations for easing.
Chandler noted that even with weaker demand for recent Treasury auctions, yields remain relatively low, and a third straight month of rising core CPI likely won’t derail rate cut bets. This would support broader risk assets, including cryptocurrencies and equities.
