Bitcoin dropped by 1.3%, while major cryptocurrencies like Ethereum (ETH), Solana (SOL), Cardano (ADA), and XRP decreased by up to 3%. Dogecoin (DOGE) experienced the largest slump, falling 4.5%. The crypto market as a whole declined by 3% in anticipation of the upcoming U.S. Consumer Price Index (CPI) readings, with expectations for a 0.3% monthly increase and a 12-month inflation rate of 2.9%. Traders speculate that a dollar unwind may occur if rate cuts are indicated, which could lead to a rise in risk assets and attract crypto investors. QCP Capital noted that the market is long on the dollar, suggesting that any positive news could lead to significant unwinding of positions, pushing risk assets higher. However, Bitcoin's performance has lagged behind equities and gold, reflecting a cautious crypto community amidst thin liquidity and last week’s large-scale liquidations. Despite this, strategies to purchase downside protection remain popular in the current environment.

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