Bitcoin briefly surged above $89,000 before reversing sharply, as traders weighed softer U.S. CPI data against skepticism over inflation metrics and Fed rate cut odds.
Bitcoin’s price exhibited sharp volatility on Thursday, climbing to $89,300 after a cooler-than-expected November U.S. CPI reading of 2.7%, down from 3%, raised hopes for looser Federal Reserve policy. Gains reversed within hours, with BTC dropping to $85,500 before stabilizing near $86,000, down 0.8% over 24 hours. Skeptics questioned the data due to a zero rent input in October CPI calculations, leaving January rate cut odds unchanged at 24%. Equity markets held stronger gains, with Nasdaq up 1.7%. Options market data indicated BTC traders see support around $85,000 and capped upside near $100,000, while ETH traders showed more hedging behavior. Bitcoin’s realized capitalization hit a record $1.125 trillion despite a 36% price correction.