Bitcoin Rally Cools Following CPI Release, But Bulls May Not Be Done

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On Tuesday, the crypto market went crazy with excitement as bitcoin surged from a daily low of around $22,800 to a high of over $26,300. The move comes as assets in the space restart after the banking crisis that affected USDC, one of the largest stablecoins in the space. The BTC rally has cooled off since then, losing over $1,500 in the last day, but that doesn’t mean the rally is over.

Reasons behind BTC’s monster rally

On Monday, March 13, Changpeng “CZ” Zhao revealed that his exchange Binance was trading $1 billion in assets such as bitcoin, ethereum and BNB from the exchange’s SAFU. This did not come after the Securities and Exchange Commission (SEC) ordered Paxos, the issuer of Busd, to stop issuing new tokens.

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The buying spree by Binance undoubtedly exerted massive buying pressure on the market, fueling demand, and fueling the rapid price increase that was experienced. The positive sentiment surrounding the market also spilled over with the CPI data release, meaning the announcement was already priced in. With an inflation rate of 6%, the market simply shook it off and continued on its way.

However, there has been a bearish phase in the market during the last 12 hours. This most likely stems from profit taking with investors. Over 72% of all BTC wallets are now in profit, This caused bitcoin price to drop below the $25,000 level, placing it in the position of major resistance from the bears, but the digital asset is unlikely.

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Bitcoin price chart from

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BTC price slides below $25,000 | Source: BTCUSD on

More bitcoin purchases may be coming

Situated in the $24,000 area, bitcoin is still at a good buying opportunity level for investors. Given that the digital asset has hit an all-time high of $69,000, there is still plenty of runway for investors looking to make money.

Tether USD (USDT) flows for the last day also point in the same direction, with over $1.8 billion flowing into exchanges. Now, when the inflow of stablecoins into the exchanges is high, it points to buying pressure as investors are picking up the coin so that they don’t miss the pump. This is because investors turn to stablecoins to avoid volatility, and when they take these coins back to exchanges, it is usually with the intention of converting them to bitcoin and other cryptocurrencies.

Investor sentiment has also improved significantly with fear and greed index Greed returned with a score of 56 on Tuesday. It is now back in neutral territory, but with BTC above $24,000, it is still biased towards greed, at a time when investors are more bullish about the market.

Unless there are more catastrophic events such as a bank collapse with large crypto exposure or a major crypto firm going bankrupt, bitcoin is likely to continue its rally and gain $25,000 once again before the end of the trading day. .

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