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Solana Gains 5% Despite CPI Latest Data And FTX Liquidation Approval – Here Could Be Why

Solana (SOL) has recorded a 5% gain in the last 24 hours amidst certain concerning developments in the crypto space. On Wednesday, the United States published its Consumer Price Index (CPI) data for August, which shows that inflation rose from 3.2% to 3.7%, higher than the predicted outcome by analysts.

In addition, the bankrupt FTX exchange obtained court approval to liquidate its crypto holdings worth $3.4 billion as it looks to offset its debt.

Normally, developments such as this are expected to induce a selling pressure on crypto assets.  However, the majority of the market is staying afloat with slight gains in the last few hours, while Solana has even embarked on a rally, drawing much attention from investors. 

Interestingly, popular crypto analyst Michaël van de Poppe has given possible reasons as to why the crypto market may not be moving as widely expected. 

Most of FTX’s Solana Are Staked And Inaccessible – Analyst Explains

According to an X post on Wednesday, Michaël van de Poppe states that there should not be much reaction from the crypto market despite the latest CPI data and the court approval for FTX’s liquidation.

Related Reading: Solana Potential Rebound: Can Bulls Hit Their $30 Target?

The analyst explains that most of the Solana, which makes up the bulk of the FTX crypto holdings, with a value of $1.2 billion, is currently staked and thus cannot be liquidated.

Van de Poppe states that only 7 million SOL is available to FTX for liquidation, and most of these tokens have been sold in the past week. Given these circumstances, the analyst predicts a “sell the rumor, buy the news” scenario would likely occur.

In relation to the other crypto holdings of FTX, Michaël van de Poppe states the exchange is only allowed to sell $200 million worth of assets per week. 

Furthermore, the current market prices have been factored on during the calculation of this liquidation rate; thus, it will likely not produce a high level of selling pressure. 

In addition to Solana, FTX also looks to liquidate other assets such as Bitcoin (BTC), Ethereum (ETH), Aptos (APT), and XRP, among others.

Van De Poppe’s Take On CPI Report

Explaining the crypto market’s response to the latest CPI data, Michaël van de Poppe explains that while inflation rates rose higher than predicted in August, the core CPI value was 4.3% as expected, which is lower than July’s value of 4.7%

Related Reading: SOL Price Prediction: Solana Takes Hit and Could Dive To $15

Therefore, the analyst postulates that the US Federal Reserve would likely not be introducing any interest rate hike. This is because the Fed is known to focus more on core CPI data, which provides a long-term outlook on the nation’s inflation rate. 

At the time of writing, Solana trades at $18.69, with a loss of 0.29% in the last hour based on data from CoinMarketCap. Meanwhile, the token’s trading volume is up by 47.89% and is now valued at $446.52 million. 

Solana

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Analyst Sounds Buy Alarm For Bitcoin, But There Is A Catch

Bitcoin (BTC) soared by over 5% on Tuesday to trade above $26,000 for the first time this week. A major contributor to this price rise was an increase in positive sentiment around the token as a result of Franklin Templeton, a $1.45 trillion asset manager, filing for a spot bitcoin ETF with the US Securities and Exchange Commission (SEC)

However, as the market euphoria dies down, the premier cryptocurrency has experienced some market recorrection, with many investors now speculating on the token’s next movement. On this note, popular crypto analyst Ali Martinez has discovered a buy signal for BTC investors. However, there are certain conditions to be met.

$28,350 or $31,800, How High Can Bitcoin Go?

According to an X post on Tuesday, Ali Martinez states that the TD sequential indicator has produced a buy signal on Bitcoin’s weekly chart. Therefore, BTC could be set for a price rally after losing about 10.85% of its market value in the last 30 days. 

For context, the Tom Denmark (TD) sequential indicator is a technical analysis tool used to identify the exact time of trend exhaustion and price reversal. However, Martinez notes there is a clause to his latest prediction.

In order to confirm the buy signal generated by the TD sequential indicator, Bitcoin must close this week trading above $25,600. Upon fulfilling this condition, the analyst predicts that BTC could trade as high as $28,350-$31,800 in the coming weeks. 

CPI Report Incoming: What Could This Mean For BTC Market?

In other news, many BTC investors and crypto investors are likely on high alert, waiting for the United States to publish its monthly CPI data report, which is slated for release on Wednesday. 

The Consumer Price Index, which measures the percentage change in the price of a basket of goods and services, is a popular indicator of inflation. 

Related Reading: Bitcoin Price Signals Another Bearish Formation and Could Revisit $25K

If the upcoming CPI report presents a rise in inflation for the month of August, it may prompt the US Federal Reserve to hike interest rates, which is popularly known to induce a dip in the demand for risk assets such as Bitcoin and other cryptocurrencies.

At the time of writing, Bitcoin is trading at $26,136.30 with price gains of 1.64% in the last seven days, respectively. Meanwhile, the token’s daily trading volume declined 24.19% and is now valued at $14.83 billion. 

Bitcoin