BlockBeats report: On May 10, Bitcoin may face weaker support when the U.S. releases its inflation report next week compared to the previous two CPI data releases, increasing the risk of a pullback to $70,000. The Cleveland Fed’s latest real-time inflation forecast estimates that April CPI rose year-over-year to 3.56%, up from 3.3% in March; monthly CPI is projected at 0.45% (below 0.9%), core CPI year-over-year at 2.56% and month-over-month at 0.21% (previously 2.6% and 0.2%). The official April CPI report will be released on May 12.
This keeps the inflation landscape complex—despite a slowdown in monthly momentum and relatively stable core inflation, overall CPI is still expected to accelerate again. This is not an ideal environment for risk assets. Stronger annual CPI readings could reinforce the Fed’s view that rapid rate cuts are difficult, often pressuring speculative assets like Bitcoin. However, Bitcoin previously avoided deeper drawdowns during hotter-than-expected CPI reports. After the March CPI report showed overall inflation rising from 2.4% in February to 3.3%, BTC prices surged over 15%. One key reason was institutional buyers absorbing more than 500% of the newly mined Bitcoin supply, with Strategy accounting for the bulk. But this support now appears weakened: Strategy has paused its BTC purchases, and its STRC preferred shares continue trading below $100 par value. When STRC trades below par, the efficiency of issuing new shares declines, limiting Strategy’s ability to raise fresh capital for additional Bitcoin purchases.
Analyst Killa noted that large investors may begin reducing their risk exposure around the inflation report, citing a similar cautious pattern observed before and after the 2025 CPI event. He stated: “The key support level is the weekly open at $78,600; if broken, the next downside target lies between $74,000 and $75,000.” Technically, Bitcoin is forming a classic ascending wedge on the daily chart—a pattern typically viewed as a bearish reversal. As of Sunday, BTC is advancing toward the apex of the wedge, around $84,000, where both trendlines converge. A breakdown from this level could trigger a drop toward the wedge’s measured downside target near $70,000. Conversely, a breakout above the apex—especially if aligned with the 200-day EMA—could fully invalidate the bearish structure, with the next upside target in the $90,000 to $95,000 range.