Bitcoin and XRP give back gains as cooler inflation meets rising oil prices

Bitcoin and XRP gave back Wednesday's initial gains after cooler-than-expected inflation data coincided with rising oil prices. CoinDesk reported that core PCE prices rose 0.2% in August, against a 0.3% forecast. CoinDesk put the year-over-year reading at 3.0%, against an estimate of 3.3%. Market commentator Bull Theory said the Bureau of Labor Statistics changed how it measures advisory fees, software and legal services. Bull Theory cited analysts' estimates that the change reduced core PCE by up to 20 basis points. However, Bull Theory argued that the cooler reading was not solely the result of the methodology change. Gross domestic product grew at an annualized 2.2% rate in the second quarter, above a 1.5% forecast. Consumer spending rose 0.6% in August, its biggest increase since March 2025. Friday's jobs report is the last major data release before the Federal Reserve meets. The mixed signals leave traders facing a Federal Reserve that may not need to raise rates and an economy that is not clearly cooling. Brent crude rose 3% on the day, with no resolution to the Middle East conflict in sight. Bull Theory said Bitcoin rose above $85,000 and Ethereum returned above $2,700 as PCE inflation reached a six-month low. Bull Theory said more than $75 million in short positions were liquidated within 60 minutes. Bitcoin subsequently settled near $84,000, and XRP settled near $1.50. Bitcoin traded flat after reaching $85,599 earlier in the session. Bitcoin remained above its key exponential moving averages, while its relative strength index stood at 61.72. Bitcoin's resistance levels were $85,600 and $87,600; its support levels were $82,100 at the 20-day exponential moving average and $80,700. XRP rose 0.5% after reaching $1.54. A descending trendline from XRP's August high near $1.70 continued to limit its price. XRP's relative strength index stood at 58.57. XRP's resistance levels were $1.54 and $1.60; its support levels were $1.46 at the 20-day exponential moving average and $1.40.