Americas Crypto Daybook: Bitcoin Options Indicate Upward Trend as Bullish Sentiment Grows Ahead of Key Inflation Data

By Francisco Rodrigues (All times ET unless stated otherwise) Over the weekend, Bitcoin (BTC) experienced a surge, providing relief after a week of market instability. Currently, it is trading around $106,600, having gained 1.2% in the past 24 hours, while the broader CoinDesk 20 (CD20) index saw an increase of nearly 1.7%. The recovery seems to be driven more by the absence of significant news rather than its presence, marking a shift away from the public dispute between U.S. President Donald Trump and Tesla CEO Elon Musk that had unsettled investors. As tensions eased, markets began to recover. Even potentially negative developments did not appear to impact markets significantly. These include the Taiwan-based cryptocurrency exchange BitoPro confirming it had been hacked and data from Blockchain.com showing a slowdown in Bitcoin's network activity to its lowest level in a year. Meanwhile, the Hang Seng index jumped 1.6% as traders responded to U.S. President Donald Trump's optimistic outlook for talks with China in London, which began today, stating the meeting "should go very well." However, concerns about deflation in China are growing. Consumer prices dropped 0.1% year-over-year in May, and factory gate prices fell 3.3%, the steepest decline since October 2022. The People's Bank of China has responded by cutting interest rates, reducing reserve requirements, and injecting liquidity into the market. This could eventually benefit cryptocurrencies, which often trade in line with traditional market liquidity conditions. All this may become less significant on Wednesday when the U.S. releases its latest inflation figures. The May consumer price index report is expected to show a rise in core inflation to 2.9%, up from 2.8% in April. A stronger-than-expected reading could delay the Federal Reserve's next interest rate cut and introduce volatility across financial markets. In a note published Monday, Spanish bank Bankinter warned that rising inflation and U.S. bond yields could pressure equity valuations and weaken the momentum driving global stocks and other risk assets. The yield on the 10-year Treasury has already climbed to 4.5%, a level that could start to impact market sentiment if inflation exceeds expectations. For now, crypto markets are caught in the midst of these developments. Remain vigilant! Key Events to Watch Token Events Conferences The CoinDesk Policy & Regulation conference (formerly known as State of Crypto) is a boutique event held in Washington on Sept. 10, bringing together general counsels, compliance officers, and regulatory executives with public officials responsible for crypto legislation and regulatory oversight. Token Talk By Francisco Rodrigues Derivatives Positioning Market Movements Bitcoin Statistics Technical Analysis Crypto Equities ETF Flows Spot BTC ETFs Spot ETH ETFs Source: Farside Investors Overnight Flows Chart of the Day While You Were Sleeping In the Ether