Bitcoin stood the test of time as a stable asset when the crypto markets went through a course correction after the release of the US CPI report. Despite a higher-than-expected inflation rise of 3.5% in March, trading at $70,798.51, Bitcoin managed to bounce back, gaining 3.6% on April 10, with its price trajectory reversing upward.
As per Santiment, an analytic firm, this reversal came as a surprise to some, given the initial drop to $67,500 just before the CPI results were announced. However, astute market observers noted a deliberate posturing by Bitcoin whales, who appeared to have orchestrated the dip to capitalize on the CPI event.
Analysts pointed out that whales, large holders of Bitcoin, strategically manipulated the market by driving down prices before swooping in to buy the dip. This theory gained traction as trading indicators, such as Material Indicators’ FireCharts binned CVD, confirmed increased buying activity on major exchanges like Binance. The sight of “purple whales” purchasing Bitcoin during the dip reaffirmed suspicions of coordinated efforts to accumulate more BTC at lower prices.
The impact of whale activity was further underscored by traders like Jelle and Daan Crypto Trades, who observed significant buying pressure that helped propel Bitcoin back above $69,000. Daan Crypto Trades also highlighted the closure of a new gap in CME Bitcoin futures markets, which appeared over the weekend due to out-of-hours volatility. This concerted effort by whales to exploit market fluctuations exemplifies their influential role in shaping Bitcoin’s price movements.
Though the CPI report for inflation caused sentiment in the markets to become volatile and stocks experienced a downtrend, reacting to the inflationary data, Bitcoin stood out as a resilient crypto asset. While equities markets faltered, the crypto market exhibited remarkable resilience, with traders displaying confidence by advocating for “buy the dip” strategies. The influx of discussions surrounding the CPI report underscored the heightened awareness among traders regarding its potential impact on prices.
Interestingly, while traditional equities faced challenges, the US spot Bitcoin exchange-traded funds (ETFs) maintained their upward trajectory, with products from BlackRock and Fidelity Investments recording modest inflows. Despite a slight setback on April 9 due to outflows from The Grayscale Bitcoin Trust (GBTC), overall sentiment remained bullish, as evidenced by continued inflows into Bitcoin ETFs.
