Bitcoin Rallies to $79K as Markets Parse Mixed Inflation Data
In brief
- Bitcoin rebounded to $79,007 with a 3.24% daily gain after initial CPI weakness
- Annual core inflation cooled to 2.4% since 2021, but monthly core reading hit 0.3%
- Polymarket prices 62% odds of a 25-basis-point Fed rate hike; CME FedWatch shows 69%
- Ethereum surged 7.48% to $2,611; crypto market cap approached $2.7 trillion
- Bitcoin's 50-day moving average crossed above its 200-day, forming a bullish golden cross
The Mixed Signal
Bitcoin opened Friday at $76,529 and briefly dipped toward $76,040 after the CPI print. The monthly core reading spooked traders, signaling the Fed's inflation fight isn't fully won. Yet the annual numbers—especially core's retreat to 2.4%—offered hope for a pause or slower tightening path.
Bitcoin climbed as high as $79,837 through the session and now trades near $79,007, a 3.24% gain on the day. The recovery reflects crypto's appetite for clarity. Fed Chair Kevin Warsh said at Jackson Hole that the Fed still has "work to do" on inflation, a signal that rate cuts may not arrive as quickly as some hoped. Yet the annual trend—especially the drop in core—gives the Fed room to hold steady or move cautiously.
Altcoins Lead, Technicals Flash Green
The broader market bounced harder than Bitcoin. Ethereum led the majors higher, up 7.48% on the day to reclaim $2,611, while Solana climbed 4.53% back above $100. Zcash was the standout across the top 10, up 23.09% over the past week alongside a 4.71% daily gain.
Total crypto market capitalization climbed back toward $2.7 trillion. The Crypto Fear & Greed Index jumped back to 73, in greed territory, a sharp rebound from 56 after Thursday's hot producer-price data. Bitcoin's 50-day exponential moving average has now crossed above its 200-day, a golden cross—a bullish technical signal. The Relative Strength Index sits at 59.7, in bullish territory and well below the 70 reading that would flag the move as overbought.
What the Market Priced In
CME FedWatch puts the odds of a 25-basis-point hike at roughly 69%, while Polymarket prices the same outcome at 62%. The gap reflects uncertainty. Three regional Fed presidents already dissented in favor of a hike at the July meeting, and a hot monthly core reading gives hawks ammunition for September.
Activity surged across venues. 24-hour trading volume was up 2.27% to $877.11 billion, and open interest across crypto futures rose 1.52% to $429.99 billion. The volatility came with a cost: the session triggered $897.09 million in liquidations, split between $493.85 million in long positions and $403.24 million in shorts.
One note of caution: spot Bitcoin ETFs are still showing a net outflow of roughly $330.5 million on the day, a reminder that institutional flows haven't fully capitulated to the rally.
