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Bitcoin fell below $74,000 on Tuesday after hotter-than-expected U.S. inflation data, trading at $73,363, down 1.6%. October's Consumer Price Index rose 0.4%, above the 0.3% forecast, while core CPI increased 0.3% against expectations of 0.2%. Ether fell 3.7% to $2,042, and Solana dropped more than 4% to below $83.
Why it matters
The inflation figures raised concerns about the Federal Reserve's interest rate outlook. Bitget analyst Lewis Huang said higher yields and a stronger dollar could add to Bitcoin's selling pressure, identifying the 200-day moving average near $73,200 as a key support level.
Matt Mena, senior crypto research strategist at 21Shares, also highlighted $73,000. The level is near Bitcoin's pre-election 2024 all-time high and its April 2025 lows. A sustained break below it could send BTC toward $69,000, near its 2021 cycle high, he said.
Market impact
Mena pointed to Bitcoin's 50-week moving average as another support level. A break could put further pressure on Ether's $2,000 support, with $1,800 the next level to watch.
There is an upside scenario if Bitcoin holds $73,000 and equities continue to rebound. 21Shares sees a potential retest of $78,000, with a move above that level putting $85,000 in reach by year-end.
Wincent senior director Paul Howard said institutional investors' use of options and other hedging instruments is reshaping Bitcoin volatility. Without a meaningful shift in monetary policy, regulatory clarity or institutional capital flows, he sees a gradual downward drift as more likely than a sustained rally toward $100,000.
Frequently asked questions
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How did October inflation compare with forecasts?
The U.S. Consumer Price Index rose 0.4%, above the 0.3% forecast. Core CPI increased 0.3%, against expectations of 0.2%.
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Why are analysts watching Bitcoin's $73,000 level?
21Shares strategist Matt Mena said $73,000 is near Bitcoin's pre-election 2024 all-time high and its April 2025 lows. He warned that a sustained break below it could send BTC toward $69,000.
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What Bitcoin support level did Bitget identify?
Bitget analyst Lewis Huang highlighted the 200-day moving average near $73,200. He said a sustained move below it could increase the risk of a deeper pullback.
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What levels is 21Shares watching for Ether?
Mena warned that a break of Bitcoin's 50-week moving average could put further pressure on Ether's $2,000 support, with $1,800 as the next level to watch.
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What would support a Bitcoin rebound in the 21Shares scenario?
If Bitcoin holds $73,000 and equities continue to rebound, 21Shares sees a potential retest of $78,000. A move above that level could put $85,000 in reach by year-end.
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