to leave a comment.
▲ Bitcoin (BTC) crash/ChatGPT generated image ©
The US inflation shock has pushed up Treasury yields and concerns about interest rate hikes, shaking the virtual asset market once again. The total cryptocurrency market capitalization fell by 1.28% over 24 hours to $2.63 trillion, and the correlation coefficient with the S&P 500 reached 93%, indicating that this correction was a result of sensitivity to macroeconomic variables rather than inherent crypto-specific negative factors.
According to CoinMarketCap, a cryptocurrency market data aggregator, on September 10 (local time), the US Producer Price Index (PPI) for August 2026 rose by 5.4% year-on-year, exceeding market expectations. As inflationary pressures proved stronger than anticipated, the US 10-year Treasury yield surged to 4.95%, and the market's implied probability of a Federal Reserve (Fed) interest rate hike next week also increased to approximately 70%. Consequently, virtual assets moved as risk assets alongside stocks, leading to a widespread sell-off across the market.
The downturn was further exacerbated by leveraged liquidations. In Bitcoin (BTC), liquidations totaling $85.64 million occurred over 24 hours, with long positions accounting for 92% of this. Observations on social media also suggested that approximately $100 million worth of long positions were liquidated in just 20 minutes. Major assets including Bitcoin, Ethereum (ETH), and Bitcoin Cash (BCH) fell by 1-11%, and no significant relative strength was observed in meme coins or decentralized finance (DeFi).
In the short term, the market is closely watching the US Consumer Price Index (CPI), which will be announced on September 11. If the CPI also exceeds market expectations, inflation concerns and interest rate hike forecasts will intensify, potentially expanding the correction in the virtual asset market. Conversely, if inflation slows more than expected, interest rate pressure could ease, providing room for investor sentiment to stabilize.
Technically, the total cryptocurrency market capitalization of $2.59 trillion has been presented as the primary support level based on the 23.6% Fibonacci retracement. If this level breaks, the range of $2.53 trillion to $2.51 trillion, where the 38.2% Fibonacci retracement and the 30-day Exponential Moving Average (EMA) are located, is considered the next major support. If CPI comes in strong, there's a possibility of a push down to $2.53 trillion, whereas if inflation slows, the market could attempt to stabilize around $2.59 trillion, according to analysis.
Ultimately, the market's direction hinges on US inflation data and the Fed's monetary policy signals next week. The current trend is closer to cautious bearishness, and whether the $2.59 trillion support holds has emerged as a crucial turning point for further correction. Particularly, if interest rate hike expectations persist even after the CPI release, a correction down to the $2.53 trillion range is possible, making this a period where confirming macroeconomic variables takes precedence over short-term rebounds.
*Disclaimer: This article is for investment reference only, and we are not responsible for investment losses based on it. The content should be interpreted for informational purposes only.*
Newsletter
Get key news delivered to your email every morning
to leave a comment.