Bitcoin Surges 24% as US Inflation Data Boosts Bullish Sentiment

Bitcoin’s technical indicators and favorable US economic data are setting the stage for a potential rally towards $115,000. Investor sentiment has surged to a seven-month peak, supported by a bullish pennant pattern and improving macroeconomic signals. The upcoming US Producer Price Index (PPI) release could be a pivotal catalyst for Bitcoin’s price trajectory.

Bitcoin (BTC) has demonstrated resilience in the face of fluctuating macroeconomic conditions, with recent US Consumer Price Index (CPI) figures coming in below expectations. The CPI’s year-over-year increase of 2.4%, slightly under the forecasted 2.5%, alongside a core CPI reading of 2.8%, has contributed to a dip in the US Dollar Index (DXY) to a multimonth low of 98.5. This weakening dollar environment typically benefits BTC, as it enhances its appeal as a non-correlated asset. Technical analysis reveals a bullish pennant formation on the 1-hour chart, suggesting a continuation of upward momentum. The measured move from this pattern targets a price near $115,000, aligning with broader market optimism.

Data from Santiment highlights a surge in positive Bitcoin sentiment, reaching levels not seen since late 2024. Social media platforms have recorded a doubling of bullish commentary compared to bearish views, reflecting growing confidence among retail and institutional investors alike. Crypto trader Jacob Canfield notes the unusual combination of rising prices with flat funding rates, indicating that the rally is predominantly spot-driven rather than fueled by leveraged positions. This dynamic reduces the risk of abrupt sell-offs and supports a more sustainable price advance. The relative strength index (RSI) hovering near 50 further suggests a healthy consolidation phase, setting the stage for continued gains.

The forthcoming US Producer Price Index (PPI) report, scheduled for June 12, is anticipated to play a critical role in shaping Bitcoin’s near-term price action. Market consensus projects a modest increase of 0.2% month-over-month for headline PPI and 0.3% for core PPI. Should the data come in lower than expected, it would reinforce dovish Federal Reserve expectations, potentially accelerating BTC’s rally by diminishing concerns over aggressive interest rate hikes. Conversely, a higher-than-forecast PPI or unexpected macroeconomic developments could prompt corrective movements. Traders are advised to monitor this release closely as it may dictate the trajectory of Bitcoin through the second half of 2025.

Renewed optimism surrounding a US-China trade agreement has contributed to a more favorable risk environment for Bitcoin. The deal, reportedly near final approval, aims to alleviate macroeconomic uncertainties that previously pressured BTC prices to a year-to-date low of $74,500 in April. This development has fostered a “risk-on” sentiment, encouraging capital flows into higher-risk assets including cryptocurrencies. Bitcoin’s consolidation just below $110,000 reflects cautious optimism as market participants await confirmation of the agreement’s implementation and its broader economic impact.

Bitcoin’s current technical setup, combined with encouraging US inflation data and positive investor sentiment, positions the cryptocurrency for a potential rally towards $115,000. The upcoming PPI report represents a significant event that could either reinforce or challenge this bullish outlook. Meanwhile, geopolitical developments such as the US-China trade deal continue to support a constructive environment for BTC. Market participants should remain attentive to these factors, as they will likely influence Bitcoin’s price dynamics in the coming weeks. Prudent risk management and timely analysis remain essential for navigating this evolving landscape.