TLDR
- Bitcoin declined to $79,200, losing 2.3% in a 24-hour period after breaching the critical $80,000 threshold.
- Among leading cryptocurrencies, Solana experienced the steepest decline at 5.6% to $90, while Dogecoin emerged as the sole gainer.
- Consecutive inflation reports — CPI reaching 3.8% and PPI climbing 1.4% monthly — disrupted Federal Reserve rate reduction forecasts.
- Geopolitical concerns intensified following the Trump-Xi meeting in Beijing, where Xi issued warnings about Taiwan-related conflicts.
- U.S. Bitcoin spot ETFs experienced $233 million in withdrawals on May 12, with analyst Ali Charts flagging a potential decline toward the 50-day SMA at $75,000.
Bitcoin experienced significant downward pressure Thursday as elevated inflation metrics and heightened geopolitical concerns dampened risk appetite across markets. The leading cryptocurrency traded at $79,200 during Asian trading sessions, marking a 2.3% decline across 24 hours.
The decline followed a period where Bitcoin had maintained the $80,000 threshold as a support zone throughout much of the previous week. This foundational level collapsed under mounting pressure from two straight inflation surprises.
Tuesday’s consumer price index delivered a 3.8% annual reading — representing the most elevated figure in nearly three years. Wednesday brought additional concerns when the producer price index registered 1.4% month-over-month against expectations of 0.5%, with annual figures reaching 6%.
These inflationary developments create obstacles for the Federal Reserve’s anticipated interest rate reduction timeline, eliminating a crucial catalyst that cryptocurrency markets had been anticipating.
Geopolitical Tension Adds to Sell Pressure
The historic Trump-Xi summit in Beijing, marking the first visit by a serving U.S. president to China in approximately a decade, introduced fresh market uncertainty. Throughout their discussions at the Great Hall of the People, President Xi cautioned about potential “collision or even clashes” should Taiwan matters be improperly managed.
Remarkably, China published Xi’s statement summary before the summit had concluded, unsettling investor sentiment in markets worldwide. Asian equity indexes experienced volatile trading, with mainland Chinese equities declining 1.3%.
Solana (SOL) suffered the most significant cryptocurrency losses, dropping 5.6% to $90 and erasing the majority of its weekly advances. Ether decreased 2.1% to $2,250 and shows a 3% weekly decline. BNB retreated 1.6% to $660, while XRP fell 1.7% to $1.43. Dogecoin stood alone among major cryptocurrencies with a positive movement, climbing 0.9% to $0.1126.
Analyst Ali Charts observed on X that Bitcoin appears to have faced rejection at its 200-day simple moving average positioned at $82,500, cautioning that this development “may lead to a retest of the 50D SMA at $75,000.” Such a movement would constitute an additional 5% decrease from present price levels.
ETF Outflows Signal Institutional Exits
Blockchain analytics provider Glassnode observed that the 7-day simple moving average of U.S. spot ETF net flows declined to -$88 million daily — representing the most substantial outflow period since mid-February. Glassnode emphasized that February’s withdrawals occurred during price declines, whereas this current wave represents “selling into strength, with BTC trading near $80k,” indicating institutions capitalized on the recent price recovery for exit strategies.
Bitcoin spot ETFs registered $233 million in aggregate withdrawals on May 12, with Fidelity’s FBTC leading at $86.13 million. Ethereum spot ETFs experienced $131 million in outflows during the identical trading session.
Key Support Levels to Watch
Matt Mena, senior crypto research strategist at 21Shares, emphasized that the $80,000 level maintains critical importance. A sustained breach beneath this threshold would probably initiate a retest of $78,000, with $75,000 serving as the subsequent defensive boundary.
The $78,000 price point represented the early-May trough preceding Bitcoin’s advance to $82,000. This level constitutes the immediate critical examination point as macroeconomic indicators and the Trump-Xi discussions continue evolving.
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