📊 Markets today face an important test after the release of U.S. inflation data. Higher inflation—especially core inflation—makes the Federal Reserve’s task harder, and increases the likelihood that policy will remain tight, or that interest rates may even be raised at the next meeting.

In my view, the picture in the short term leans bearish for risk assets like Bitcoin and cryptocurrencies, because higher rates—or even just a higher probability of rate hikes—means less liquidity and more pressure on the market.

However, I don’t think this necessarily signals the start of a long-term decline. If inflation data starts to improve later on, rate expectations could shift quickly, and then positive momentum could return to BTC and the rest of the market.

So my current bias: 🔴 cautious/bearish in the short term, while monitoring the Fed’s decision and the upcoming data before making any trading decision.

Question: Do you think the Federal Reserve will raise rates or keep them unchanged? 👇

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