Bitcoin · Federal Reserve (FED) · Ethereum · The Block
Bitcoin’s fragile floor cracks as Fed hawks circle and ETF investors keep pulling out: analysts
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Bitcoin fell to $58,000 on Thursday before partially recovering, extending a correction that has pushed the world's largest cryptocurrency to its lowest levels since late 2024, as a hotter-than-expected core PCE inflation reading stoked fears that the Federal Reserve will keep interest rates elevated for longer.
Key facts
- With roughly 80% of that notional out of the money, the expiry settled with max pain at $72,000–$74,000, far above spot, undermining the price-pinning mechanics that max pain theory predicts
- The $60,000 put wall, anchored by roughly $450 million in June 26 puts, constituted the structural floor heading
- Bitcoin was trading around $59,000 on Friday, still below the $60,000 psychological level it breached on Thursday when it hit its intraday low of $58,000
- Gabe Selby, head of research at CF Benchmarks, pointed to the $50,000–$60,000 zone as a historically durable base
Summary
The May Personal Consumption Expenditures price index, the Fed's preferred inflation gauge, showed core prices rising 3.4% year-over-year, its highest level since October 2023, while the headline index accelerated to a 4.1% annual rate driven in part by higher energy prices. "Bitcoin deepens its correction as inflation strengthens the Fed's hawkish stance," Simon-Peter Massabni, Head of Retail Sales at XS.com, said. Can-Luca Koymen, investment strategist at Sygnum Bank, read the print similarly. "This is a print-by-print Fed now, and the number that also matters is this core PCE print, not CPI, since that's the Fed's preferred gauge," Köymen said.