Bitcoin drops $1,000 to $63,000 as CPI relief fails to lift crypto

Bitcoin fell more than $1,000 to near $63,000 after July CPI matched forecasts at 3.4%, failing to lift a market that priced in the relief.

"Clear on-chain trends show inventory moving from long-term holders to short-term holders and then back to new long-term holders, further implying sell-side saturation," K33 Research analysts said in a Tuesday report. "This has left BTC stuck in a rigorously bland trading range, chopping around at close to a 50 percent drawdown from its all-time high."

The Consumer Price Index rose 0.1% month-over-month in July after falling 0.4% in June, the Bureau of Labor Statistics reported Wednesday at 8:30 a.m. ET. Core CPI climbed 0.2% monthly and 2.5% annually, both in line with consensus. Spot Bitcoin ETFs recorded $4.89 million in net inflows on Aug. 11, according to SoSoValue data, with BlackRock's IBIT adding $50.2 million while Fidelity's FBTC, ARKB, and VanEck's HODL saw combined outflows of $25.98 million. Total ETF trading volume reached $1.42 billion, with combined net assets of $77.46 billion, or 6.06 percent of Bitcoin's market value.

Bitcoin faces resistance at $64,400 and $65,000, with the 50-day EMA at $64,582 reinforcing the cap. A daily close below $63,000 support could open a path toward $62,000 and $60,000. The CME FedWatch tool shows roughly 50 percent odds of a September rate hike, keeping macro uncertainty elevated.

Why the market shrugged

The CPI print landed exactly where economists expected, removing any surprise factor. At 3.4 percent, annual inflation remains well above the Federal Reserve's 2 percent target, and a tame reading did not open the door to easing. Investors had also moved early — spot Bitcoin ETFs pulled in roughly $854 million over five consecutive sessions last week as rate-hike bets faded, their strongest run since May.

The technical backdrop remains fragile. Bitcoin trades below all key EMAs on the daily chart — the 50-day at $64,582, the 100-day at $66,757, and the 200-day at $72,497 — suggesting the broader trend stays under downside pressure. The RSI sits at 47, just below neutral, while the MACD histogram remains slightly negative. Bitcoin's 24-hour trading volume stood at $18.12 billion, with market capitalization at $1.29 trillion.

Glassnode analysts flagged thin liquidity and subdued demand, leaving the market vulnerable to sharp moves. CryptoQuant data showed Bitcoin producing a second early bull signal, a pattern that has historically appeared closer to market bottoms, though the firm cautioned that lingering market stress persists.

Total crypto market cap slipped 0.9 percent to $2.17 trillion. Ethereum traded at $1,920, up 2.11 percent, while BNB rose 1.02 percent to $572 and Solana gained 1.04 percent to $74.

Bitcoin already received one macro excuse to rally last week when a weak jobs report pointed to a dovish Fed, and it did not take it. The same pattern repeated with CPI. Until buyers step in above $64,400 or sellers exhaust below $63,000, the range-bound grind is likely to persist.

This article is for informational purposes only and does not constitute investment advice.