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

I see Bitcoin’s rally accelerating after July’s US Consumer Price Index (CPI) printed a year-over-year rise of 2.7%, undercutting the 2.8% estimate and bolstering prospects for monetary easing. Core CPI came in at 3.1%, in line with expectations, while monthly CPI and core CPI grew by 0.2% and 0.3% respectively.

Cooling headline inflation reinforces the case for lower rates, which is generally bullish for risk assets like Bitcoin (BTC). The CME FedWatch tool now prices in roughly a 93.9% chance of a September Fed rate cut, a shift that could attract fresh demand into crypto markets. At the same time, the unchanged core CPI suggests underlying price pressures remain, meaning the Fed may seek more convincing evidence before easing policy.

I’m watching next week’s Producer Price Index (PPI) as a potential confirmatory data point — a softer PPI would strengthen the bullish macro narrative and likely support further BTC inflows.

Price action shows volatility: after a weekend spike to $122,190, BTC pulled back about 3% to $118,500 and failed to close above $120,000. Following the CPI print it recovered to $119,500, and I view $119,982 as a critical level to validate near-term upside. A daily close above $120K could trigger the next leg of the rally.

From a technical standpoint, a bullish flag breakout points to a $130,000 target, and analyst Titan’s trendline interpretation extends the objective toward $137,000. Conversely, failure to retake $120K may expose BTC to a slide toward $117,650–$115,650, which would also align with the weekend CME gap.

Even amid the current upside momentum, I acknowledge that Bitcoin remains vulnerable to a deeper correction; a breach of key supports could open a path down to $100K or even $95K.