Bitcoin slipped under $78,000 on Wednesday following a US inflation reading that came in slightly above expectations. The move lower hit crypto and traditional markets at the same time.
The July Personal Consumption Expenditures (PCE) index, the Federal Reserve’s preferred inflation gauge, came in at 3.7% year-on-year. Analysts had expected 3.6%. Month-on-month, the index rose 0.2%, with core PCE also up 0.2%.
Trading resource The Kobeissi Letter noted on X that “US inflation continues to run at nearly double the Fed’s 2.0% target.”
BREAKING: US July PCE inflation, the Fed's preferred inflation metric, hits 3.7%, above expectations of 3.6%.
Core PCE inflation was 3.3%, the second highest reading since October 2024.
US inflation continues to run at nearly double the Fed's 2.0% target.
Own assets or be left…
— The Kobeissi Letter (@KobeissiLetter) August 26, 2026
The data disappointed markets that had been optimistic after June’s PCE unexpectedly dropped, including the first month-on-month decrease in six years.
US stocks opened lower and gold fell below $4,600 per ounce following the release. BTC saw up to 1% daily losses according to TradingView data.
Despite the dip, onchain analytics firm CryptoQuant said Bitcoin has entered the early phase of a new bull market following a 25%+ rally since last week. The firm’s Bull Score jumped from 30 to 80 in one week — its highest reading since October 2025, when BTC was trading around $124,000.
Eight of ten onchain metrics tracked by CryptoQuant are now flashing bullish.
CryptoQuant head of research Julio Moreno said the key level to watch is $83,000, where the 365-day moving average currently sits. He said a close above that level would be “official” confirmation of a new bull market.
The firm credited two macro catalysts for the recent rally: the US Treasury’s plan to double long-term bond buybacks to at least $4 billion per operation from September 9, and President Trump’s comments suggesting the US government may consider buying Bitcoin.
Spot demand is growing at its fastest monthly pace since late December, and spot and futures demand are expanding together for the first time since early October 2025.
Analyst Ted (@TedPillows) on X put it simply: “$83,000 — if Bitcoin breaks above this, the cycle bottom will be confirmed, and there’ll be no dump to $50,000.”
$BTC move to $50,000 or $100,000 first depends on one level.
$83,000.
If Bitcoin breaks above this, the cycle bottom will be confirmed, and there'll be no dump to $50,000.
Trade with me: https://t.co/kzZIKQsFwf https://t.co/YCJ8BuaoUN pic.twitter.com/nBFLK8CDcV
— Ted (@TedPillows) August 26, 2026
CryptoQuant flagged short-term overheating. Traders’ unrealized profit margin hit 20.5%, its highest since June 2025, a level that historically triggers profit-taking.
Short-term holders booked $1.2 billion in realized profits from Aug. 20–22, including a record $614 million in a single day on Aug. 20.
Exchange inflows also rose sharply. Bitcoin inflows reached around 53,000 BTC, the highest since June 5. ETH inflows hit 1.7 million ETH, also a June 5 high. XRP whale inflows climbed to 460 million XRP, their highest since February.
Analyst Rekt Capital warned on X that BTC is at risk of continuing its series of lower highs in place since October 2025. He identified the 50-week EMA at $77,251 as a key level for Bitcoin to reclaim and hold. Bitcoin’s last monthly close above that level was in October 2025.
Bitcoin is rejecting from the Macro Downtrend
A Monthly Close below the blue resistance would not just solidify another Macro Lower High but would also build a confluent resistance in association with the Macro Downtrend$BTC #Bitcoin https://t.co/qBMC4CNknc pic.twitter.com/bws93zlkT9
— Rekt Capital (@rektcapital) August 26, 2026
The PCE data arrives one day before the Fed’s annual Jackson Hole symposium, where Fed Chair Kevin Warsh is scheduled to give the keynote address on Friday.
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