Bitcoin has a new line in the sand. Thursday’s core PCE could stress test it.

Bitcoin established a new support level around $65,000 this week, a threshold that could face significant stress following the release of the U.S. Personal Consumption Expenditures (PCE) price index data on Thursday, May 30, 2024. This inflation report is closely watched by the Federal Reserve and market participants as it influences monetary policy decisions. A higher-than-expected PCE reading could signal persistent inflation, potentially leading the Federal Reserve to delay interest rate cuts, which would likely put downward pressure on risk assets like Bitcoin. Conversely, a cooler inflation report might bolster investor confidence and support Bitcoin's current price level. Analysts are monitoring this key economic indicator to gauge the immediate future trajectory of the cryptocurrency. The market's reaction to the PCE data will be a crucial test for this newly established support line, with potential implications for Bitcoin's price in the short to medium term.