Dogecoin and XRP Slide Amid Continued Profit-Taking Ahead of Friday’s Inflation Announcement

As markets await the crucial Core PCE inflation data set for release this Friday, investors are closely monitoring crypto price movements amid ongoing macroeconomic uncertainties.

Bitcoin (BTC) saw a modest 1% decline over the past day, while XRP and Dogecoin (DOGE) each dropped roughly 2.5%, reflecting a tentative market recovery rather than a strong rally.

The recent volatility can be traced back to last week’s announcement by former U.S. President Donald Trump, who proposed raising tariffs on European imports to 50%, up from 20%, triggering a sell-off across risk assets including cryptocurrencies.

“Bitcoin’s slight rebound followed Trump’s decision to delay the tariff hike, which initially sparked a market sell-off over the weekend,” noted Jeffrey Ding, chief analyst at HashKey Group, via Telegram.

“This provided some relief to traders, fostering renewed risk appetite, especially as MicroStrategy CEO Michael Saylor hinted at further Bitcoin acquisitions,” Ding added.

On Monday, Trump announced postponing the tariff implementation to July 9 after a “constructive call” with European Commission President Ursula von der Leyen, easing immediate tensions.

Nevertheless, Singapore-based QCP Capital warned that such policy shocks highlight the fragility of market stability.

Bitcoin’s implied volatility spread between July and June options, which had surged above 2 vols last week, has now narrowed below 1, signaling traders’ cautious stance ahead of the tariff deadline.

This spread measures expected future price fluctuations and suggests a market awaiting further catalysts.

Investors are now focused on the Core Personal Consumption Expenditures (PCE) index, excluding volatile food and energy prices, a key inflation metric used by the Federal Reserve to guide monetary policy.

Institutional demand for crypto remains firm, with BlackRock’s IBIT spot ETF seeing 30 consecutive days of net inflows, highlighting sustained institutional interest.

QCP also noted a divergence between crypto and traditional technology sectors, with cautious positioning in products like the TQQQ NASDAQ ETF, while crypto continues to hold ground.

“In an environment of unpredictable policy moves,” QCP concluded, “cryptocurrency markets are increasingly perceived as a stable and mature asset class.”