Wintermute: Bitcoin May Drop to $70K Level If Breaks Below $75K Amid Inflation Surge

According to Wintermute, on May 19, U.S. inflation re-accelerated and Federal Reserve rate expectations reversed within five trading days, shifting from bets on rate cuts to concerns of renewed hikes. The U.S. 10-year Treasury yield rose to 4.58%, and a more hawkish Fed chair will take office in three weeks. Cross-asset performance reflects this shift: Brent crude surged 8.6% this week, while Bitcoin dropped 5.7% and Ethereum fell 10.2%, with crypto underperforming stocks as capital flows toward inflation-driving assets.

Wintermute highlighted the 7.6-7.8 thousand USD range as a key level for Bitcoin. If BTC holds this zone following Nvidia's Wednesday earnings report, market confidence may recover. However, should Bitcoin break below $75,000 amid falling funding rates and continued ETF outflows, it could rapidly test the $70,000 level, Wintermute warned.