Leading cryptocurrencies were little changed Wednesday overnight as higher-than-expected core inflation data weighed on investors’ decisions. 

What Happened: Bitcoin plunged below $56,000 during morning hours after core inflation for August exceeded estimates, moderating expectations for a 50-basis-point rate cut at next week’s FOMC meeting. 

However, a swift recovery saw the leading cryptocurrency nearly touch $58,000 by market close. Bitcoin was still down 0.47% over the past week, and 1.89% since September began.

Ethereum also recovered its morning losses and hovered around the mid-$2,300 mark.

The total cryptocurrency liquidations breached $125 million in the last 24 hours, with the lion’s share of upside bets getting wiped out. 

Traders taking bullish long positions on Bitcoin surged compared to those positioning for price declines, as seen by the spike in the Long/Short Ratio.

The Cryptocurrency Fear & Greed Index fell to 31 from 37 a day before, indicating significant FUD in the market.

Top Gainers (24-Hours)

The global cryptocurrency market stood at $2.02 trillion, following a marginal increase of 0.15% in the last 24 hours.

Stocks ticked higher on Wednesday. The S&P 500 rose 58.61 points, or 1.07%, to end at 5,554.13, while the tech-focused Nasdaq Composite added 2.17% to close at 17,395.53. Both of these indices clocked their third straight day of gains. The Dow Jones Industrial Average inched 0.31% higher to finish at 40,861.71.

Like cryptocurrencies, stocks fell after inflation data came higher than expected. Investors now anticipitated an 85% chance of a 25-basis-point cut as of this writing, according to the CME FedWatch tool. Next on their radar is the producer price index data, due to be released Thursday.

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Analyst Notes: Co-founders of the blockchain analytics platform Glassnode, Jan Happel and Yann Allemanna, who go by their pseudonym Negentropic on X, noted the peak of the Bitcoin Risk Index.

Looks like a great time to accumulate spot BTC,” the handle said, adding that entering during this phase carries a “substantial reward.”