Key takeaways:Bitcoin investor sentiment hits a seven-month high, with a bullish pennant forecasting a rally to $115,000.Wednesdays CPI print and the chance for a lower-than-expected PPI on Thursday could drive BTC price higher.Bitcoin (BTC) price briefly rallied above $110,000 on Wednesday after US Consumer Price Index (CPI) data came in cooler than expected at 2.4% year-over-year (forecast: 2.5%).
Core CPI also beat estimates at 2.8% (forecast: 2.9%).
The US Dollar Index (DXY) plummeted to 98.5, a multimonth low, with markets swiftly adjusting to the Federal Reserves interest rate expectations.US Dollar Index monthly chart.
Source: Cointelegraph/TradingViewHowever, the odds of a Federal Reserve interest rate cut next week remain low as headline CPI is rising again for the first time since January.The overall market sentiment around Bitcoin is bullish, and a cooler CPI print could potentially push prices to new highs above $115,000 this week.
A price rally might occur on Thursday, after the US Producer Price Index (PPI) data is released.
The PPI is expected to rise by 0.2% month-over-month, with the core PPI at 0.3%.A lower-than-expected print could amplify Bitcoins rally by reinforcing dovish Fed expectations over the second half of 2025.
A higher-than-expected PPI or a surprise macroeconomic development could lead to pullbacks.Cointelegraph also reported that Bitcoin is closing in on a new high, buoyed by renewed optimism over a US-China trade deal announced by US President Donald Trump.The agreement is expected to reduce macroeconomic threats that dragged BTC prices to a year-to-date low of $74,500 in April after Trumps tariff announcements.
This deal, described as done pending final approval, has sparked a risk-on mood, with BTC consolidating under $110,000.Related: Unique Bitcoin holder trend backs BTCs next price discovery phase: GlassnodeAccording to data analytics platform Santiment, BTCs bullish sentiment reached a seven-month high, as positive social media comments, tracked across X and Reddit, have doubled negative ones since Trumps election win in November 2024.Bitcoin bullish sentiment data by Santiment.
Source: X.comThe bullish sentiment is also reflected in BTCs low funding rate at an all-time high price range.
Crypto Trader Jacob Canfield stated,I honestly don't remember a time where I've seen prices going up this much and funding rates being completely flat.
This usually means that the underlying rallies are mostly spot driven.
Not sure how we're going to see big sell offs without high leverage in the market.
Most likely this means higher.From a technical standpoint, Bitcoin is forming a bullish pennant on the 1-hour chart, signaling potential bullish continuation.
The relative strength index (RSI) is resetting near the 50 level, indicating a healthy cooldown within a higher consolidation range.
Immediate resistance lies at $110,000, but a liquidity sweep around $108,000 could occur first, clearing late long orders and absorbing sell-side liquidity to fuel further upside.Bitcoin 1-hour chart.
Source: Cointelegraph/TradingViewThe pennants measured move projects a bullish target of $115,000, aligning with the upper trendline extension.
Additional price support lies at $106,748, with a break below risking a drop to $104,900.
A swift recovery from this drop could enhance BTCs upside potential, but BTC must maintain a bullish close on the higher time chart.Related: New Bitcoin treasuries may crack under price pressureThis article does not contain investment advice or recommendations.
Every investment and trading move involves risk, and readers should conduct their own research when making a decision.