Bitcoin climbs above $73,000 as inflation cools and risk appetite returns

Bitcoin price managed to break above $73,000 as the US trading hours began, after enduring some sideways movement and minor consolidation early in the day.

Over the past 24 hours, risk sentiment has improved significantly, driven by cooling inflation data and favorable macro catalysts. This is evident on the Crypto Fear and Greed Index, which surged 4 points to hit 50, a score that marks a return to the neutral level for the first time in weeks.

Liquidity has rushed back across the board, with the total crypto market cap climbing over 2% to sit comfortably above [MONEY value="2550000000000" currency="usd" notation="long" replace="false"].

Meanwhile, altcoins have also come back to life after weeks of a grueling downturn, posting double-digit gains as investors rotate capital back into higher-beta assets.

Why is Bitcoin price going up?

Bitcoin price managed to breach through the vital resistance level at $73,000 after the March CPI data came in lower than the market's worst-case fears.

As per US Bureau of Labor Statistics data released today, the headline CPI came in at 3.3% while Core CPI (MoM) remained steady at a modest 0.2%.

Markets had already priced in a disaster due to the conflict with Iran and the resulting spike in oil prices above $110 per barrel, with many expecting a print as high as 3.6% or 3.7%.

However, as the actual figures came in below those elevated consensus estimates, investors breathed a sigh of relief.

Against this backdrop, the US and Iran have stopped direct hostilities and have agreed on a temporary ceasefire.

Although there are tensions around Lebanon, reports suggest diplomatic talks are ongoing, and a resolution around the Strait of Hormuz could soon be finalised, ensuring the flow of global energy supplies.

This has pushed oil prices back below $90, and risk assets are surging in response to the de-escalation.

Meanwhile, Morgan Stanley launched the first US bank-affiliated Bitcoin ETF today, providing a massive bridge for legacy capital to enter the space.

Bitcoiners were also celebrating legislative progress in the US. Over the past few days, there’s been a lot of optimism around the Clarity Act, which is expected to be a game-changer for institutional adoption by providing a clear regulatory framework for digital assets.

Recently, several lawmakers have publicly signaled their support, and there’s a chance that the bill could be up for a floor vote in the upcoming Congressional session.

While the aforementioned macro catalysts have driven the narrative, Bitcoin’s rally today was also supported technically by massive short liquidations, as bears hoping for a breakdown toward $60,000 were caught off guard, resulting in over [MONEY value="290000000" currency="usd" notation="long" replace="false"] in short liquidations.

What’s next for Bitcoin?

For now, Bitcoin price is hovering at a crucial resistance level, as there’s a dense cluster of sell orders between $73,000 to $74,000.

If Bitcoin manages to sustain its momentum and break through this overhead supply, there’s very little technical resistance up until $80,000, which is the next major psychological target area that has not been breached since the pre-halving volatility spike in late January.

On X, crypto analyst JDK Analysis said Bitcoin is now approaching a decisive point, where the reaction at the current highs could determine the next leg of the move.

He noted that price is testing the upper boundary of a multi-week structure, with the $73,000 region acting as the key level to watch. A sustained move above this zone, in his view, would confirm strength and open the door for further upside continuation.

At press time, the Bitcoin price was hovering above $73,000 with gains above 2% on the day.

However, he also warned that failure to hold above the level could flip the outlook quickly. A brief move above resistance followed by a rejection, often referred to as a swing failure pattern, could trap late buyers and trigger fresh short positions.

Rejection at current levels may push price back toward the $68,000 to $70,000 support band in the near term.

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