Bitcoin's Wild Ride: A Rollercoaster of Gains and Losses

Bitcoin's Volatile Day

Bitcoin had a crazy day, going up and down like a rollercoaster.

• Started strong, reaching almost $89,300
• Dropped sharply to $85,500 in just a couple of hours
• Settled around $86,000 by the end of the day, still lower than the previous day

Inflation Data Sparks Early Rally

The early boost in Bitcoin's price came when the U.S. reported inflation dropped to 2.7%. This made people think the Federal Reserve might cut interest rates in January.

• Traditional markets like the Nasdaq also went up due to this news.

Doubts Emerge

But not everyone was convinced.

• Some experts pointed out that the inflation numbers might be misleading because they didn't include rent and housing costs properly.
• This made people doubt the Fed's plans, and the markets started to wobble again.

Rate Cut Uncertainty

Right now, the chances of a rate cut in January are still low, at only 24%. This shows that the market is not fully convinced by the recent inflation data.

Crypto Options: Caution Prevails

In the world of crypto options, traders are being cautious.

Bitcoin Options

• Suggest that people think the price will stay between $85,000 and $100,000 for now.
• Not expecting a big breakout soon.

Ethereum Options

• Show more uncertainty.
• Traders are setting support levels around $2,700 to $2,800.
• Selling calls above $3,100, meaning they are protecting themselves against big gains.

Mixed Feelings in the Crypto Market

Overall, the crypto market is showing mixed feelings.

• Bitcoin seems to have some support.
• Ethereum traders are more cautious and are hedging their bets.