Crypto Analysts Turn More Bullish, but Hot CPI Triggers Coin Sell-Off

what happened

Most crypto analysts have shifted from bearish to bullish, according to CryptoQuant. The firm says 89% of analysts are positive on bitcoin, 88% on ethereum and 91% on solana. CryptoQuant describes the turn as deeper and faster than the price move behind it.

Major cryptocurrencies nevertheless declined after an inflation report that came in hotter than expected. Bitcoin lost 2.1%, ethereum 3.3%, XRP 3.1% and solana 2.8%, WSJ reports. Earlier that morning bitcoin had traded near 84,000 dollars before sliding to 82,457. Steve Neamtz of Yorkville America argues that bitcoin and gold both offer protection against currency debasement, though gold has a far longer track record. Bitcoin fell 1.9% and gold 1.6% on the day.

CME FedWatch data put the odds of a Federal Reserve rate hike in October at 50%. BMO analysts describe the odds as near a toss-up and say Fed Chairman Kevin Warsh's appearance at the IMF annual meeting in Bangkok on Friday will be closely watched.

why it matters

For markets, the key question is how inflation and expectations for Fed policy will affect risk assets. Higher rates typically weigh on cryptocurrencies and equities, while a stronger dollar reduces the appeal of gold. More optimistic analyst sentiment does not remove the near-term pressure, so investors will be watching Warsh's remarks closely.

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