Bitcoin Could Reach $137K as CPI Boosts Fed Rate-Cut Odds

I saw Bitcoin’s rally pick up steam after July’s US Consumer Price Index (CPI) showed headline inflation holding at 2.7% year-over-year, below the 2.8% estimate. Core CPI came in at 3.1%, in line with forecasts. Monthly CPI slowed to 0.2% and core CPI rose 0.3%.

Cooling inflation bolstered the case for monetary easing, which I view as bullish for risk assets like Bitcoin. The CME FedWatch now prices a roughly 93.9% chance of a September Fed rate cut. Still, the steady core CPI suggests underlying price pressures remain, meaning the Fed may seek more evidence before easing policy.

I’ll be watching next week’s Producer Price Index — a softer print could reinforce the lower-rate narrative and attract fresh demand into BTC.

Price action saw Bitcoin surge to $122,190 over the weekend before a quick 3% pullback to about $118,500, failing to close above $120,000. After the CPI release, BTC rebounded toward $119,500, with $119,982 as a key level to confirm near-term upside. In my view, a daily close above $120,000 could ignite the next leg higher.

From a technical perspective, a bullish flag breakout points to a $130,000 target, and analyst Titan’s projection of $137,000 after a trendline breakout aligns with that momentum scenario. Conversely, if BTC cannot reclaim $120K, I see downside risk toward $117,650–$115,650, which would also align with the weekend CME gap.

Despite the current strength, I remain aware that Bitcoin is still vulnerable to a deeper correction that could test $100,000 or even $95,000 if key support levels fail.