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Bitcoin (BTC) skyrocketed in the first week of 2025, with prices fluctuating between $95,000 and $101,000. Analysts expect that several macro events could further increase King Coin’s volatility in the coming weeks.
10x Research said in its latest post that despite the bullishness seen at the beginning of the year, the uptrend will be modest compared to the first quarter of 2024.
The analysis said one of the factors that could cause a spike in volatility is the upcoming release of inflation data in mid-January and the inauguration of President Donald Trump later this month.
“We expect a strong start to the year, followed by a slight pullback leading up to the January 15th release of the CPI data. Strong inflation will reignite optimism and President Trump’s January 20th “This could drive an uptick in the run-up to Inauguration Day,” the study said.
US Federal Reserve could cause Bitcoin price fluctuations
Several events related to the US Federal Reserve can cause BTC prices to change. On January 8, the agency will release the minutes of the Federal Open Market Committee (FOMC) December meeting.
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At its last meeting in 2024, the Fed cut interest rates by 25 basis points, but also took a slightly more hawkish stance, emphasizing that inflation remains a concern. Therefore, if the minutes show that inflation risks remain high, this could cause price fluctuations.
The Fed’s next FOMC meeting is scheduled for January 29th, and most investors agree that interest rates will remain unchanged. According to the CME FedWatch Tool, 93% of investors expect interest rates to remain between 4.25% and 5%.
(Source: CME FedWatch tool)
“The main risk remains the Fed’s communication, especially if there are new concerns about inflation. We expect inflation to decline this year, but we expect the Fed to formally recognize and respond to this change.” may take some time,” 10x Research noted.
Bitcoin is often touted as a hedge against inflation, but it tends to react whenever inflation levels rise. Therefore, King Coin is likely to record volatility later this month.
Despite these concerns, Bitcoin has recorded a strong recovery, with Bitcoin once again surpassing $100,000 amid rising institutional demand from spot Bitcoin exchange traded funds (ETFs). BTC was trading at $100,765 at the time of writing after gaining 1.29% in 24 hours.
