Crypto Market Rebounds: DOGE, XRP Shine, Bitcoin Climbs Above $96K Ahead of Inflation Report

The recent plunge in stocks and cryptocurrencies may have altered the market dynamics surrounding Donald Trump’s inauguration, making it less likely to become a “sell the news” event, K33 Research said.

Bitcoin (BTC) staged a robust recovery on Tuesday, climbing as high as $97,300 after dipping below $90,000 during Monday’s broad-market selloff. The rebound was driven by reports of pro-crypto executive orders being prepared by Trump’s incoming administration, as well as softer-than-expected U.S. Producer Price Index (PPI) data for December.

At press time, BTC was trading around $96,500, up 3% in the past 24 hours. The CoinDesk 20 Index, a broader market benchmark, gained 5%, led by strong performances from XRP and dogecoin (DOGE), which rose 6%-7%.

In the equities market, the Nasdaq and S&P 500 ended the day flat as traders weighed recent economic data against higher bond yields and a strengthening U.S. dollar.

Bitcoin continues to hover above $90,000 in a sideways consolidation pattern. Recent hot U.S. economic data has cooled expectations for additional Federal Reserve rate cuts this year, causing volatility across global markets.

All eyes are now on Wednesday’s Consumer Price Index (CPI) report, which could further clarify the Fed’s next moves and trigger additional market turbulence.

Meanwhile, Trump’s Jan. 20 inauguration is shaping up as a potentially market-moving event. Speculation is mounting over his administration’s anticipated pro-crypto stance, which has fueled optimism among digital asset investors.

K33 Research had earlier warned that the inauguration could present a prime opportunity for a “sell-the-news” event. However, this week’s selloff has led the firm to temper its outlook.

“Initially, we leaned toward selling into the inauguration rally, but the recent downturn in both BTC and equities makes that approach less compelling unless momentum sees a strong revival over the next few days,” K33 wrote in its latest report.

“The S&P 500 erased its post-election gains, and bitcoin touched two-month lows this week,” the report continued. “Any short-term de-risking would depend heavily on near-term market developments, though our long-term outlook for Trump’s positive influence on bitcoin remains intact.”