Bitcoin witnessed a surprise bounce to almost $95K and pared the gains to fall back below $90K this week. Bitcoin ETFs flows and MSCI’s decision on MSTR also failed to provide constructive cues on market direction amid geopolitical tensions and mixed jobs data. Traders to closely watch these 3 events that could signal whether Bitcoin to crash or rally ahead.
Bitcoin to Crash or Rally to Depend on US CPI Inflation Data
The U.S. Bureau of Labor Statistics (BLS) will release December’s CPI inflation data on January 13, the most crucial data anticipated by global investors following the end of the US government shutdown.
The previous US CPI data showed inflation cooled to 2.7%, which marked the biggest drop in US inflation since March 2025. Core CPI inflation also fell to 2.6%, below expectations of 3.0%.
As Bitcoin reacts sharply to inflation, a further drop in inflation will trigger a rally towards $95K again. It will also boost 25 bps Fed rate cut odds in January, which currently sit around 14%.
However, hotter-than-expected CPI data could push price towards the CME gap near $88K. The crypto market crash risks will rise amid tighter liquidity and continued redemptions from spot Bitcoin ETFs.
Spot Bitcoin ETFs recorded almost $1.20 billion in net outflows in the past few days. This indicated a cooling risk appetite as investors continued profit booking in BTC.
US PPI Inflation Data
The Labor Department will release October and November’s PPI data together on January 14. It will show how the inflation wavered during the government shutdown, which raised financial stress in the US banking sector.
The Federal Reserve acted and decided to end the quantitative tightening (QT) in December. The Fed injected billions of dollars to raise liquidity in the financial industry.
Producer prices in the United States came in at 2.7%, according to a delayed report by the BLS. However, the monthly PPI inflation data came in higher at 0.3%.
Bitcoin could see selling pressure if PPI inflation data comes higher. Wall Street giants are yet to reveal the estimates. However, experts say they see a lot of volatility in the data over the past weeks as housing is cooling fast.
US Banks’ Earnings Season Can Shake Bitcoin Price
Major US banks will report fourth-quarter earnings, with investors optimistic over strong profit growth this year. Analysts expect that overall earnings from S&P 500 companies climbed 13% in 2025 and estimated a further rise of over 15% in 2026, Reuters reported.
JPMorgan Chase will open the earnings season on Tuesday. Citigroup, Bank of America, Goldman Sachs, and Morgan Stanley are among those reporting later in the week. Financial sector earnings are expected to have climbed 6.7% in the fourth quarter.
While the odds of stocks correcting at this point are low, geopolitical events could shake sentiment. As CoinGape reported, after a U.S. military operation in Venezuela, President Donald Trump hinted at operations in Colombia and Greenland.
Bitcoin traders, whales, and institutional investors’ activity were mixed this week, signaling a struggle to get clear cues on the market direction.
Analysts also gave mixed predictions. According to Ted Pillows, the first level to watch is the $89,200 level, which has acted as support. If this is lost, Bitcoin will drop towards the $87,500 level.
If upside momentum persists, BTC needs to hold above $95K to confirm the uptrend. A daily close above this will most likely push BTC towards the $102,000-$103,000 level.
Analyst Michael van de Poppe claimed Bitcoin is still in a state of boredom as price continues to consolidate above the 21-day MA.