After retreating back to the $69,000 area during the early US morning hours on Wednesday, bitcoin has quickly skyrocketed to almost $71,000.
Other crypto assets, including ether (ETH), solana (SOL), and XRP, experienced the same sharp upward moves.
The gains appeared to come as crude oil quickly reversed most of its session’s big gains, falling $3 a barrel in a matter of minutes. At press time, April WTI crude oil futures were at $85, up 2% on the day.
The drop in crude oil also benefited stocks, with the Nasdaq turning from a small drop to a 0.5% gain in early US trading.
Cryptocurrency-related stocks were mixed: Strategy (MSTR), Galaxy Digital (GLXY), and Bullish (BLSH) posted modest gains, while Coinbase (COIN) and eToro (ETOR) fell slightly.
With the ongoing war against Iran, risk markets this week have been mainly dominated by oil price developments. Stocks and cryptocurrencies plunged Sunday night as oil rose to $120, but then rose as oil quickly retreated.
New inflation data
Wednesday’s February CPI report was in line with economists’ forecasts, rising 0.3% month-on-month, putting the 12-month inflation rate at 2.4%. However, next month could show a very different picture due to the outbreak of war between the United States and Iran, raising the question of whether the Federal Reserve will respond to the temporary shock or take a tougher stance after being caught off guard during the last inflation cycle.
Stephen Coltman, head of macro at 21shares, says the Fed’s choice will be pivotal, noting that investors will closely monitor next week’s Fed meeting for signs on how officials plan to react.
As for bitcoin, the rise in next month’s data is probably “already in the cake,” he said.
