The cryptocurrency market reacted positively to the release of inflation data, leading to increased optimism about potential monetary easing by the Federal Reserve.
Major cryptocurrencies such as Bitcoin, Ethereum, and Dogecoin saw significant gains, with Bitcoin surpassing $100,000 and Ethereum reaching $3,800. Altcoin dominance also increased by 4.41% in the past 24 hours.
Bitcoin recorded a 4% increase, reaching $100,927.86, while Ethereum surged by 7% to $3,828.77. Dogecoin also saw a 7% rise, trading at $0.4121. The overall cryptocurrency market capitalization rose to $3.61 trillion, reflecting a 5.02% increase in one day.
This positive momentum coincided with a rebound in the stock market, with the Nasdaq Composite closing at a record high.
The recent price surge in Bitcoin resulted in over $240 million in liquidations, wiping out $154 million in leveraged short positions. However, the number of traders shorting Bitcoin has increased, indicating a prevailing expectation of a potential dip.
Analysts are closely monitoring Bitcoin's performance, particularly its ability to maintain levels above the $97,844 resistance point. Ethereum has also gained attention, with analysts predicting significant price movements. One analyst has forecasted that Ethereum could reach $4,900 "very soon" after reclaiming the $3,800 level as support. This bullish outlook is supported by ambitious price targets for Ethereum in the first quarter of 2025.
The recent price action in Ethereum reflects increasing investor confidence in the cryptocurrency market, driven by institutional interest.
The alignment of inflation data with market expectations has created a favorable environment for cryptocurrencies, with traders optimistic about potential rate cuts from the Federal Reserve.
The interplay between traditional financial indicators and cryptocurrency performance will continue to be a focus for investors and analysts.