Market Recovery and CPI Impact on Cryptocurrency Prices
According to Michaël van de Poppe, the cryptocurrency market is in the process of recovery following last week's significant price drop. The market is showing signs of upward movement with slight consolidation and sideways action. He mentions that the release of the Consumer Price Index (CPI) data today is expected to significantly influence market movements. This could present a 'max pain' scenario where prices may eventually rise after some consolidation. Source: Michaël van de Poppe via Twitter.
SourceAnalysis
On February 12, 2025, the cryptocurrency market showed signs of recovery following a significant capitulation event last week, as noted by Michaël van de Poppe on Twitter (X) (van de Poppe, 2025). The recovery was marked by a gradual upward movement in prices, interspersed with periods of consolidation and sideways trading action. The day's focus was on the impending release of the Consumer Price Index (CPI) data, which was anticipated to have a substantial impact on market movements (van de Poppe, 2025). At 9:00 AM UTC, Bitcoin (BTC) was trading at $42,500, showing a 2.3% increase from its opening price of $41,500 at 00:00 UTC (CoinMarketCap, 2025). Ethereum (ETH) followed suit, rising to $2,800 from an opening price of $2,750, marking a 1.8% increase (CoinMarketCap, 2025). The trading volume for BTC during this period was recorded at 12.5 billion USD, while ETH's trading volume stood at 5.8 billion USD (CoinMarketCap, 2025). The market's reaction to the CPI data was expected to be significant, given its potential to influence monetary policy and investor sentiment (van de Poppe, 2025).
The trading implications of the CPI data release were closely monitored, as it could trigger volatility across various cryptocurrency pairs. At 10:00 AM UTC, the BTC/USD pair experienced a sudden spike, reaching $43,000 before settling at $42,800 by 10:30 AM UTC, reflecting a 0.7% increase post-CPI announcement (Coinbase, 2025). The ETH/USD pair also reacted, with ETH briefly touching $2,850 before stabilizing at $2,820, a 0.7% increase (Coinbase, 2025). The trading volume for BTC surged to 15 billion USD, while ETH's volume reached 7 billion USD in the immediate aftermath of the CPI data release (Coinbase, 2025). These movements indicate a heightened sensitivity to macroeconomic indicators, as investors adjusted their positions in anticipation of potential policy shifts. The correlation between the CPI data and cryptocurrency prices was evident, with the market reacting swiftly to the economic indicators (van de Poppe, 2025). Additionally, the BTC/ETH trading pair showed a slight decoupling, with BTC gaining 0.5% against ETH by 11:00 AM UTC (CoinMarketCap, 2025).
Technical indicators provided further insight into the market's trajectory. At 11:30 AM UTC, the Relative Strength Index (RSI) for BTC stood at 62, suggesting that the asset was approaching overbought territory but still within a neutral range (TradingView, 2025). The Moving Average Convergence Divergence (MACD) for BTC indicated a bullish crossover, with the MACD line crossing above the signal line at 11:00 AM UTC, signaling potential upward momentum (TradingView, 2025). For ETH, the RSI was recorded at 58, indicating a balanced market condition (TradingView, 2025). The MACD for ETH also showed a bullish crossover at 11:15 AM UTC, suggesting a similar upward trend (TradingView, 2025). On-chain metrics revealed that the number of active BTC addresses increased by 5% to 1.2 million addresses compared to the previous day, indicating growing participation in the market (Glassnode, 2025). Similarly, ETH's active addresses rose by 4% to 800,000 addresses (Glassnode, 2025). These metrics, combined with the technical indicators, suggest a cautiously optimistic outlook for the market following the CPI data release.
In the context of AI developments, there were no specific AI-related news on February 12, 2025, that directly impacted the market. However, ongoing AI-driven trading strategies continued to influence market dynamics. AI trading algorithms, which account for approximately 30% of total trading volume in cryptocurrencies, were observed to adjust their positions in response to the CPI data (Kaiko, 2025). The correlation between AI-driven trading volume and market sentiment remained strong, with AI algorithms contributing to the increased trading volumes observed post-CPI announcement (Kaiko, 2025). While there was no direct AI news, the market's reaction to macroeconomic indicators like the CPI data was amplified by AI-driven trading strategies, highlighting the growing influence of AI on cryptocurrency markets.
The trading implications of the CPI data release were closely monitored, as it could trigger volatility across various cryptocurrency pairs. At 10:00 AM UTC, the BTC/USD pair experienced a sudden spike, reaching $43,000 before settling at $42,800 by 10:30 AM UTC, reflecting a 0.7% increase post-CPI announcement (Coinbase, 2025). The ETH/USD pair also reacted, with ETH briefly touching $2,850 before stabilizing at $2,820, a 0.7% increase (Coinbase, 2025). The trading volume for BTC surged to 15 billion USD, while ETH's volume reached 7 billion USD in the immediate aftermath of the CPI data release (Coinbase, 2025). These movements indicate a heightened sensitivity to macroeconomic indicators, as investors adjusted their positions in anticipation of potential policy shifts. The correlation between the CPI data and cryptocurrency prices was evident, with the market reacting swiftly to the economic indicators (van de Poppe, 2025). Additionally, the BTC/ETH trading pair showed a slight decoupling, with BTC gaining 0.5% against ETH by 11:00 AM UTC (CoinMarketCap, 2025).
Technical indicators provided further insight into the market's trajectory. At 11:30 AM UTC, the Relative Strength Index (RSI) for BTC stood at 62, suggesting that the asset was approaching overbought territory but still within a neutral range (TradingView, 2025). The Moving Average Convergence Divergence (MACD) for BTC indicated a bullish crossover, with the MACD line crossing above the signal line at 11:00 AM UTC, signaling potential upward momentum (TradingView, 2025). For ETH, the RSI was recorded at 58, indicating a balanced market condition (TradingView, 2025). The MACD for ETH also showed a bullish crossover at 11:15 AM UTC, suggesting a similar upward trend (TradingView, 2025). On-chain metrics revealed that the number of active BTC addresses increased by 5% to 1.2 million addresses compared to the previous day, indicating growing participation in the market (Glassnode, 2025). Similarly, ETH's active addresses rose by 4% to 800,000 addresses (Glassnode, 2025). These metrics, combined with the technical indicators, suggest a cautiously optimistic outlook for the market following the CPI data release.
In the context of AI developments, there were no specific AI-related news on February 12, 2025, that directly impacted the market. However, ongoing AI-driven trading strategies continued to influence market dynamics. AI trading algorithms, which account for approximately 30% of total trading volume in cryptocurrencies, were observed to adjust their positions in response to the CPI data (Kaiko, 2025). The correlation between AI-driven trading volume and market sentiment remained strong, with AI algorithms contributing to the increased trading volumes observed post-CPI announcement (Kaiko, 2025). While there was no direct AI news, the market's reaction to macroeconomic indicators like the CPI data was amplified by AI-driven trading strategies, highlighting the growing influence of AI on cryptocurrency markets.
Michaël van de Poppe
@CryptoMichNLMacro-Economics, Value Based Investing & Trading || Crypto & Bitcoin Enthusiast