Bitcoin fell 1.5 percent from local highs on Thursday as a reversal in US equities markets offset earlier bullish sentiment driven by cooler-than-expected inflation data. The pullback saw the leading cryptocurrency give back gains made earlier in the session, with traders attributing the move to profit-taking in the tech sector.
The broader market downturn was led by Micron Technology, whose shares have now lost more than 30 percent of their value amid ongoing concerns about semiconductor demand. The sell-off weighed on the tech-heavy Nasdaq and spilled into cryptocurrency markets, where Bitcoin had been testing higher levels following positive macroeconomic signals earlier this week.
Data from the US Bureau of Labor Statistics showed consumer prices cooling more than anticipated in June, marking the largest monthly decline in inflation in several years. This initially pushed Bitcoin to its highest price point since late June, briefly exceeding $65,500 before the momentum faded.
Analysts noted that while the inflation print was broadly supportive for risk assets, the focus quickly shifted back to corporate earnings and sector-specific weakness. Microns steep decline served as a reminder that the macroeconomic landscape remains mixed, with pockets of significant stress beneath the surface of aggregate data.
The pullback in Bitcoin comes as traders evaluate whether the recent recovery has legs or if it represents a temporary reprieve within a longer-term downtrend. Technical indicators show that Bitcoin is contending with overhead resistance, and trading volumes have not yet reached levels typically associated with sustained breakouts.
Market participants are now watching for further catalysts, including the upcoming CLARITY Act hearing and any additional commentary from Federal Reserve officials regarding the path of interest rates. The conjunction of regulatory developments and monetary policy direction is expected to set the tone for cryptocurrency markets in the weeks ahead.
This article was adapted from Cointelegraph. Read the original here.
