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Analysts Anticipate Cryptocurrency Market Volatility Ahead of US Economic Data Release

Analysts Anticipate Cryptocurrency Market Volatility Ahead of US Economic Data Release

Market calm may end soon as major players eye US economic data release.

The lull in the digital asset market is expected to be short-lived as the interest of major players coincides with the release of economic indicators in the United States.

Attention is focused on non-farm employment data (September 9), producer price inflation (September 10), and the consumer price index (September 11). 

Positive figures in each category could influence the US Federal Reserve’s decision to lower the key rate. If inflation continues to rise, traders may reassess their positions in risk assets, including cryptocurrencies.

“Currently, inflation is the unknown variable in the interest rate trajectory equation,” Greg Magadini, Director of Derivatives at Amberdata, told Decrypt.

According to him, US President Donald Trump is successfully keeping energy prices in check, but “this may not be enough to counteract inflation, and without a reliable Fed mandate, inflation expectations could cause chaos.” 

Magadini noted that on September 17, alongside the Fed’s rate decision, futures tied to Wall Street’s “fear gauge” (VIX) expire. This could trigger additional instability.

“This is a powerful powder keg for volatility,” noted Sean Dawson from Derive. 

He believes that the expiring VIX futures will “clear” volatility hedging, but the Fed’s decision will cause a significant directional shock.

Back in late August to early September, crypto funds lost $352 million despite high expectations from the Fed meeting.

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