Crypto Market Corrects Amid Higher Inflation Rates
The cryptocurrency market took a dip on Wednesday as leading assets Bitcoin and XRP fell in value. The Federal Reserve's preferred inflation gauge came in higher than expected, causing a correction in the market. Bitcoin traded between $77,600 and $79,200 but failed to push above $80,000, with trading volume plummeting 35% over the last 24 hours.
Ethereum was an exception, surging to $2,500 before consolidating, though buying pressure remained subdued. XRP and Dogecoin inched lower, while cryptocurrency-related stocks fell, including Strategy Inc. (NASDAQ:MSTR) and Coinbase Global Inc. (NYSE:BMNR), which closed down 2.87%. A total of nearly $260 million was liquidated from the market in the last 24 hours, with shorts outpacing long liquidations.
Bitcoin's open interest dipped 1.95%, indicating that existing long-position buyers are exiting their positions and closing out their trades. Analyst Michaël van de Poppe noted that Bitcoin's structure is 'intact' despite the correction, but warned of potential support levels at $76,400/77,100. If those levels are lost, a deeper correction may be on the horizon.