Bitcoin could drop toward $70K after Fed nowcast

Bitcoin could fall toward $70,000 after the Cleveland Federal Reserve’s latest inflation nowcast raised April headline CPI to 3.56% year over year and several large institutional buyers paused new purchases, reducing demand ahead of the U.S. consumer price index release on May 12.

The Cleveland Fed nowcast projects April headline CPI at 3.56% year over year and a monthly rise of 0.45%, compared with a monthly 0.9% pace in prior estimates. Core CPI is projected at 2.56% year over year and 0.21% month over month. The Federal Reserve’s internal briefings have included a different monthly estimate of about 0.26%.

Institutional buying that supported Bitcoin after earlier hot inflation prints appears to have tapered. After the March CPI report, which showed headline inflation at 3.3%, Bitcoin rose more than 15% while institutional buyers reportedly absorbed more than 500% of newly mined supply. A firm identified as Strategy accounted for a large share of that accumulation but has paused BTC purchases. Strategy’s STRC preferred stock is trading below its $100 par value, a level at which issuing new shares becomes less efficient and can limit the firm’s ability to raise fresh capital for additional buys.

On technical charts, Bitcoin is forming a rising wedge on daily timeframes. The wedge’s apex sits near $84,000, a level that aligns with the 200-day exponential moving average. A break below the wedge’s lower trendline would point to a measured downside target near $70,000. If the $78,600 weekly open does not hold, some analysts identify $74,000–$75,000 as the next area where liquidity could be swept. Analyst Killa wrote: ‘Key level to hold is the 78.6K weekly open, if lost, 74–75K is the next downside target,’ and recommended watching for liquidity sweeps around that pivot.

A decisive move above the wedge apex and the 200-day EMA would invalidate the bearish pattern and open technical paths toward the $90,000–$95,000 range.

Market participants are focused on the May 12 CPI report. The Cleveland Fed nowcast and the Fed’s internal estimate differ on the monthly reading, leaving a mixed inflation picture ahead of the official release. Over the past year, Bitcoin’s price has shown volatility around U.S. CPI prints, and institutional accumulation had provided notable demand during recent rallies. The current combination of a hotter nowcast and reduced institutional purchases removes a layer of market support in the days before the inflation report.