Bitcoin surged past $66,000 early Thursday morning, having seen a 6.6% increase since this time yesterday.

At the time of writing, the Bitcoin price is $66,245.22. That's 8.3% higher than it was this time last week. The past day has seen $82 billion worth of BTC change hands, according to Coinglass.

Bitcoin has been helped along by signs that inflation in the U.S. has started to wane. On Wednesday, the Bureau of Labor Statistics released new data showing that consumer prices had fallen for the first time in six months.

That's good news for risk-on investors who trade cryptocurrency and stocks. The Consumer Price Index is one of the key metrics that the Federal Reserve tracks when deciding when (or whether) to lower federal interest rates in the states. So when the CPI shows that inflation is starting to improve, it raises the likelihood that the Fed will lower rates in 2024.

Currently, 54% of investors seem to think it's likely the Fed will lower rates in September, according to the CME FedWatch Tool. The tool uses data from the federal funds futures market—essentially measuring how investors are hedging against future rate changes—to calculate the probability of a change in the Federal Open Market Committee (FOMC) target rate.

cme fedwatch tool screenshot for september 2024
Source: CME FedWatch Tool
Speaking of futures, Coinglass highlighted early this morning that there's a big accumulation of long-standing short positions that could be wiped out if BTC maintains its upward momentum and reaches $66,900. In fact, $49 million worth of Bitcoin short positions have already been liquidated as the world's oldest and largest cryptocurrency by market capitalization rose in the past 24 hours.
Singapore-based digital asset trading firm, QCP Capital, said it expects this upward trend to continue.
"US CPI numbers triggered a break out of the range across risk assets. BTC has since traded back above 66k," the firm wrote in a recent blog post. "⁠We expect bullish momentum here that could take us back to the highs of 74k."

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