Bitcoin swings back above $96,000, in stunning reversal, as light inflation data stokes risk appetite

Bitcoin it rebounded on Tuesday, rising with other risk assets as traders digested a light inflation reading.

On Tuesday, the price of the leading cryptocurrency rose 3% to $96,452.34, according to Coin Metrics, after sliding below the $90,000 support level to start the week. The broader crypto market, as measured by the CoinDesk 20 index, added 4%.

Actions of Coinbase and Microstrategy gained more than 1% and 4%, respectively, paring the previous gains.

The move comes as the Bureau of Labor Statistics reported cooler than expected inflation Tuesday. The producer price index, which measures wholesale inflation, rose just 0.2% in December, while economists polled by Dow Jones had estimated a 0.4% increase.

Crypto prices are hanged in a shot of war between investors’ concerns about rising inflation under the incoming administration of Donald Trump and optimism about the president-elect’s pro crypt leadership, which could significantly support the industry this year. As a result, traders expected a choppier January than anticipated, which could extend throughout the quarter.

Bitcoin tumbled last week after stronger-than-expected payroll numbers caused a spike in bond yields, prompting investors to shed growth-oriented risk assets. Headlines about Trump’s tariff plans also spooked investors, giving a boost to the dollar, which has an inverse relationship with bitcoin.

Fundstrat’s Tom Lee told CNBC “Squawk Box” Monday that bitcoin could correct to $70,000 before hitting new records and eventually ending the year between $200,000 and $250,000. Crypto traders are used to bumping into bitcoin during a bull market.

Bitcoin is 10% off its record of December 17. It has increased by 3% in 2025.