The cryptocurrency market has experienced a significant downturn, shedding $60 billion from its total market capitalization in the last 24 hours. This decline comes on the heels of the US Consumer Price Index (CPI) rising to 2.4% year-over-year. While this figure was slightly below the anticipated 2.5%, it was still enough to trigger a negative reaction across digital assets, leading to a noticeable drop in investor confidence.
The total crypto market cap, currently standing at $3.36 trillion, failed to break past the crucial $3.43 trillion resistance level. If the bearish trend persists, the market could further decline to $3.31 trillion. This recent dip underscores how susceptible the crypto market is to inflation data, as rising CPI figures often fuel anxieties about future economic conditions. Conversely, an improvement in broader market sentiment could see the total market cap rebound to $3.43 trillion. A successful breach of this resistance could even push the market cap to $3.49 trillion.
Bitcoin Struggles to Hold Ground, Eyes $108,000 Support
Bitcoin (BTC) is also feeling the pressure, currently trading at $108,518. The leading cryptocurrency has twice failed to establish $110,000 as a stable support level this week, indicating persistent downward pressure and uncertain market sentiment. The inability to hold $110,000 leaves Bitcoin vulnerable to further price volatility.
BTC is now facing a potential drop to $108,000. Should bearish market conditions continue, Bitcoin may struggle to maintain this level. A break below $108,000 could see BTC test its next support at $106,265, which would worsen the current downtrend and diminish any lingering bullish momentum.
Despite these challenges, the Relative Strength Index (RSI) suggests that Bitcoin’s underlying bullish momentum remains intact, hinting at the possibility of a rebound. If this momentum holds, BTC could recover to $110,000 and potentially solidify it as a support level. This would help validate the current uptrend and restore optimism among investors.
