Bitcoin short-term ‘technical sell-off’ under $100K possible ahead of May 13 CPI print

Bitcoin (BTC) experienced a brief price correction on May 12, dropping to $102,388 after reaching an intraday high of $105,819. This correction followed positive news, including a tentative US-China trade deal and significant Bitcoin acquisitions by companies like Strategy (13,390 BTC, totaling 568,840 BTC). KindlyMD’s stock also surged 600% after merging with Nakamoto Holdings, a Bitcoin investment firm.

Despite this positive backdrop, the correction suggests profit-taking and de-risking ahead of the May 13 CPI inflation report. Glassnode data indicates strong new demand but weak momentum buyers, suggesting potential consolidation. Increased selling in perpetual and spot markets, particularly near the $106,000 resistance level, supports this view. Traders may have closed profitable positions before the CPI report or due to the perceived pricing-in of the US-China trade deal after BTC failed to sustain gains above $104,000.

The US Dollar Index (DXY) rallied, and stock indexes soared leading up to the trade deal announcement. Bitcoin’s inability to break and hold above $104,000-$105,000 before and after the market open indicates some traders secured profits. Charts show rising open interest and a spike in the funding rate, suggesting short positions opened while longs were liquidated.

Last week’s Bitcoin price rally was driven by spot purchasing, and recent announcements coupled with Bitcoin ETF inflows raise questions about sustained buying appetite. While the pace of Bitcoin adoption and regulatory improvements remain positive, the current price action seems like a short-term technical correction. The market’s reaction to the CPI report will likely influence future spot and margin long positions. This analysis does not constitute investment advice. Readers should conduct thorough research before making investment decisions.