Bitcoin Holds $88K Support as Altcoins Rally Despite CPI Data

Bitcoin’s price action this week was defined by repeated rejections near the $90,000 mark and heightened volatility following U.S. economic data. After two consecutive failures at $94,500 last week, BTC began a correction, dropping to $90,000 over the weekend. The bearish pressure intensified on Monday, driving the price under $85,500. A sharp recovery on Wednesday saw Bitcoin skyrocket to just over $90,000 within minutes, only to crumble just as quickly back below $85,500.

The release of the U.S. CPI data on Thursday, which came in better than expected, triggered another spike to $89,500. However, this level again acted as firm resistance, leading to a sell-off that drove Bitcoin to a multi-month low of $84,500. A subsequent recovery attempt on Friday saw BTC touch $89,500 once more before being rejected. As of the latest data, Bitcoin trades just above $88,000, marking a 2.5% decline on the weekly scale. Its market capitalization remains above $1.750 trillion, with its dominance over altcoins standing at 57.3%.

While Bitcoin struggled, the altcoin segment of the cryptocurrency market posted broad-based gains. Ethereum, which had slumped below $2,900 earlier in the week, quickly reclaimed that level and now sits close to $3,000 after a minor daily increase. Other major altcoins followed suit, with BNB, Solana (SOL), Bitcoin Cash (BCH), and Chainlink (LINK) all showing similar positive momentum.

XRP demonstrated notable strength, jumping over 3.5% to trade above the crucial $1.90 support level. Cardano (ADA) and Dogecoin (DOGE) each added approximately 3% in value. The most impressive performances, however, came from a cohort of smaller-cap assets. Zcash (ZEC) charted another double-digit percentage increase, now trading above $450. Hype (HYPE) rose by 5%, Cronos (CRO) by 7%, and Uniswap (UNI) by 9.5%. The token CC rocketed by over 12% to $0.09, underscoring the risk-on sentiment among altcoin traders.

The overnight rally in altcoins contributed to a $50 billion increase in the total cryptocurrency market capitalization, which now stands at $3.080 trillion according to data from CoinGecko. This expansion occurred even as Bitcoin, the market leader, faced headwinds. The dynamic suggests a potential rotation of capital within the crypto ecosystem, where traders seek opportunities in alternative assets during periods of Bitcoin consolidation.

The market’s muted reaction to positive U.S. inflation data is a key narrative. Typically, such data, which reduces expectations for aggressive Federal Reserve policy, is viewed as bullish for risk assets like cryptocurrencies. Bitcoin’s inability to capitalize on this news and break through the $89,500-$90,000 resistance zone indicates significant selling pressure at these levels. The defense of the $88,000 support level will be critical for Bitcoin’s short-term trend. A failure to hold could see a retest of the week’s lows, while a successful defense may set the stage for another attempt at the key resistance overhead, especially if altcoin strength begins to bolster overall market sentiment.