Markets
Bitcoin (BTC) Price Hits $66,000 After Moderate Inflation Data; Solana (SOL), NEAR leads crypto rally
Crypto markets recovered on Wednesday, more gently than expected US inflation data brought digital assets out of their stupor.
Bitcoin (BTC) surpassed $66,000 for the first time since April 24 and was recently up more than 7% in the last 24 hours. Ether (ETH) changed hands at nearly $3,000 but underperformed with a 4% gain over the same period.
Solana (GROUND) and nearby (CLOSE) led gains among crypto majors with jumps of 8% and 12%, respectively, and the broader market benchmark CoinDesk 20 Index (CD20) is up 6%.
The rebound came as April’s U.S. Consumer Price Index (CPI) figures were down slightly from March, coupled with a slightly flat retail sales report. The data came as a relief to investors who feared that reaccelerating inflation and a red-hot economy could force the Federal Reserve to reverse its dovish stance and even consider interest rate hikes.
“Investors view this as a bullish regime change as this is the first decline in CPI inflation in the last three months,” Bitfinex analysts said in a market update . This, combined with the fact that the Federal Reserve previously announced its intention to reduce the liquidation of the central bank’s balance sheet, “is considered a favorable number for risk assets,” Bitfinex added.
In traditional markets, US stocks also rose during the day, with the S&P 500 index gaining more than 1% and hitting a new all-time high, highlighting the return of risk appetite.
Bitcoin’s current rise also marked a break from a downward trend that had capped prices in recent weeks, Swissblock analysts said in a Telegram update.
“BTC [is] finally take a bigger step,” Swissblock said. “We are waiting for the trigger for the release of a larger structure from the March high. Today we got it,” referring to the CPI and retail sales figures.
The analytics firm said the breakout paves the way for BTC to first rally to $69,000 and then possibly towards new all-time highs targeting the $84,000 price level. During the next stage, “altcoins will follow strongly,” the report adds.