Bitcoin and Ethereum pushed higher as softer U.S. inflation data and renewed policy news from Brazil improved sentiment across the crypto market. The move extended beyond the two largest assets, pointing to a broader recovery in digital assets rather than an isolated bounce.
U.S. CPI at 2.4% revives demand for risk assets
The latest U.S. CPI reading came in at 2.4%, below the expected 2.5%. That miss supported the view that inflation pressure may be easing, a signal that often improves liquidity expectations and lifts assets that are sensitive to macro conditions, including cryptocurrencies and technology stocks.
As the market reacted, total crypto capitalization climbed to about $2.35 trillion. The CoinMarketCap 20 index gained more than 2%, showing that buying interest was spread across the market instead of being limited to Bitcoin and Ethereum alone.
Brazil reserve proposal adds to institutional confidence
Policy headlines also fed into the advance. Lawmakers in Brazil reintroduced a proposal to create a strategic national Bitcoin reserve, a development traders viewed as another sign that digital assets are entering sovereign-level policy discussions.
That matters for short-term trading as well as longer-term positioning. National policy engagement can strengthen institutional confidence, especially when it suggests broader recognition of crypto within the global financial system.
Extreme fear remains, but open interest is rising
Even with prices moving up, sentiment indicators still show stress. The Fear and Greed Index remains deep in extreme fear, a zone that has often been linked with contrarian rebounds. At the same time, derivatives open interest has jumped, indicating that traders are re-entering positions and that short covering may be adding fuel to the move.
On the chart side, Bitcoin is stabilizing near an important support area. If price can clear resistance and hold the move, momentum could build. If support fails, the current rebound could lose strength quickly.
Key Bitcoin levels sit near $68,400 and $70,600
For a clearer bullish confirmation, Bitcoin needs to break above the recent swing high near $68,400 and then clear the major resistance area around $70,600. A successful move through that range would lower the risk of renewed downside and give the market room for a stronger advance.
For now, the rally looks tied to macro relief, firmer institutional sentiment, and technical repositioning rather than a full trend reversal. Whether the market can hold recent support and keep drawing institutional inflows remains the main test for this recovery attempt.