Bitcoin (BTC) Nears All-Time Highs at $104K, Boosted by US-China Trade Talks, ETF Inflows, and Easing Inflation Concerns

Bitcoin is back in the spotlight as it trades close to its all-time high around $104,000, just 5 percent below its peak of $109,350. The rally is picking up pace with better US-China trade talks

Bitcoin (BTC) is heating up again as it trades close to its all-time high around $104,000, just 5 percent away from its peak of $109,350. The rally is picking up pace with better US-China trade talks, steady ETF inflows, and hopes of lower inflation lifting market sentiment. After falling to $75000 in April, Bitcoin has bounced back strongly, gaining nearly 10% in just a week.

U.S.-China Deal Calms Markets

The rally gained momentum after the U.S. and China struck a trade agreement in Geneva, confirmed by Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer. A joint statement is expected soon. The deal follows months of tariff hikes, which had raised inflation concerns. Now, with tensions easing, investors are optimistic that April’s CPI data won’t reignite fears.

This upcoming Tuesday is CPI day again, and it will be very important to watch. CPI is one of the main indicators for the Fed, and this release could show whether tariffs are pushing inflation higher.The forecast is 2.3%. If the number comes in at or below that, markets will… pic.twitter.com/rPTu2pW8dy

Meanwhile, April’s CPI is expected to show a slight slowdown, easing to 2.3% from 2.4% in March, according to RBC. Core CPI is expected to hold steady at 2.8%. Markus Thielen from 10x Research said if the numbers come in as expected, the market could interpret the report as bullish, possibly pushing Bitcoin beyond its previous high. Even a slightly hotter CPI might not hurt sentiment, as it would be seen as outdated, reflecting the impact of now-defused tariffs.

Continuous ETF Inflows

BlackRock’s (NYSE:BLK) spot Bitcoin ETF has seen 20 straight days of inflows, attracting over $5 billion. This, combined with the Fed’s decision to hold interest rates steady, has kept investor sentiment high. Chairman Powell even noted that the tariff’s impact on inflation is likely short-lived.

Altcoins Join the Rally

Among the altcoins, Ethereum (CRYPTO: ETH) posted its best weekly gain since 2020, surging 39% to $2,500. Dogecoin (CRYPTO: DOGE) also skyrocketed, soaring over 100% in a week to reach $0.78. ADA, XRP, and Solana also experienced substantial increases. According to HTX Research, market conditions remain healthy, with Bitcoin options volatility remaining stable and leverage still under control. Pi Coin surged 33% to $1.25, and its trading volume spiked 280% to $1.32 billion.

Price Targets Heat Up

Finally some good news for crypto traders! As the dust settles on a tumultuous 1Q23, the scene is being set for a return to the market's fundamental focus: inflation.

Coming on Tuesday, April's CPI report will be closely watched for any signs of a pause in the price declines from last year's peaks. According to economists polled by Dow Jones, the Consumer Price Index is forecast to rise 2.3% last month. This compares to March's 2.4% increase and December's 2.7% rise. The core CPI, which excludes volatile food and energy components, is expected to hold steady at 2.8%.

If the report comes in line with or better than expectations, it could be interpreted by the market as bullish, potentially pushing Bitcoin above its previous all-time high of $105,000, according to Markus Thielen, an analyst at 10x Research.

Even if the CPI report comes in a bit hotter than expected, it might not necessarily dampen the mood, as the reading would be lagging and reflect the impact of tariffs, which are no longer a major concern.

The report is due at 8:30 a.m. ET on Tuesday.

After a stellar run in 2021, Bitcoin prices crashed to lows of around $75000 in April with the cryptocurrency struggling to keep up the momentum. However, in recent weeks, Bitcoin prices have shown signs of recovery, thanks in no small part to better-than-expected economic data and a series of bullish predictions from analysts.

This rally also comes as the U.S. and China reached a trade agreement in Geneva on Thursday, confirmed by Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer. A joint statement is expected later. The deal follows months of tariff hikes, which had raised inflation concerns. Now, with tensions easing, investors are optimistic that April’s CPI data, due on Tuesday, won’t reignite fears.

According to RBC, April’s CPI is expected to show a slight