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Crypto Market Rallies: Bitcoin, Ethereum, Solana, and Dogecoin Prices Surge Amid Lower US CPI Inflation Data



The cryptocurrency market is currently experiencing a significant resurgence, with the global market capitalization increasing by 3.55% to reach $2.55 trillion. Leading the charge in this recovery are major cryptocurrencies such as bitcoin (btc), ethereum (ETH), solana (SOL), and Dogecoin (DOGE), which have all posted gains ranging from 2% to 5%. This upward momentum is largely attributed to a series of bullish events that have recently unfolded, instilling a renewed sense of optimism among investors.

Bitcoin, the flagship cryptocurrency, has notably reclaimed its position above the $69,500 mark, demonstrating a robust recovery. Ethereum has not been left behind, with its price soaring past $3,650. This revival is not restricted to the leading cryptocurrencies alone; altcoins have also joined the rally, echoing the positive sentiment that has taken hold of the market.

A key driver behind this bullish trend is the cooling off of the U.S. annual Consumer Price Index (CPI) inflation, which has dipped to 3.3%, slightly lower than the anticipated 3.4%, and down from 3.7% the previous month. The Core CPI, which excludes volatile food and energy prices, similarly showed a deceleration to 3.4% against expectations of 3.5%. Furthermore, the month-on-month core inflation has slowed significantly to 0.2%, marking a noticeable decrease from recent trends.

Federal Reserve Chair Jerome Powell has maintained his stance on implementing three rate cuts, diverging from the two cuts suggested by Federal Reserve swaps. In addition, the U.S. dollar index (DXY) has witnessed a decline, falling to 104.3. These developments collectively contribute to a more favorable environment for the cryptocurrency market, as they typically encourage investment in riskier assets like cryptocurrencies.

Market data further reinforces the optimistic outlook, with significant buying pressure observed in the cryptocurrency space. Over 20,000 BTC has been transferred to wallets, indicating a strong buying-the-dip sentiment among investors. This is a bullish signal and aligns with the upward price action witnessed recently.

Ethereum has also seen a positive turn, with a notable increase of 2.95% in its price to $3,659. This is in conjunction with a substantial outflow of Ethereum from Coinbase, one of the largest centralized exchanges, where over 337,000 ETH were withdrawn. This marks the largest exchange outflow recorded this year, signaling strong investor confidence in Ethereum.

The surge in cryptocurrency prices is further supported by data from Coinglass, which shows a significant jump in BTC futures open interest (OI), increasing by over 3% within just four hours following the CPI announcement. Similarly, Ethereum Futures OI saw an over 2% increase in the same timeframe, while DOGE Futures OI experienced an impressive 13% rise.

These indicators are clear signs of a rejuvenated crypto market, buoyed by favorable economic indicators and strong investor sentiment. As cryptocurrencies continue to recover from their recent lows, the market is closely watching for any further developments that could influence the trajectory of these digital assets. With the current momentum, the crypto market is poised for potentially more gains, as it continues to navigate through the complexities of global economic factors and investor dynamics.

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