Inflation data has completely blown past expectations, hitting a four-year high.
Bitcoin, on the other hand, rose.
A false celebration of "all bad news priced in"?
US September PPI year-over-year at 6.3%, the largest increase since 2022. Month-over-month 1.3%, expected only 0.5%. Core PPI year-over-year 5.0%, expected 4.4%, still blew past expectations. Energy prices surged 10.8% month-over-month, gasoline up 20.3%, diesel up 21%.
All significantly exceeded expectations.
Normally, with rising rate hike expectations, risk assets should collapse. But what actually happened?
The three major US stock indexes all closed higher, Dow Jones up 1.08%. Bitcoin briefly dropped below $80,000 intraday, then rebounded in a V-shape, closing back above $82,300.
Data in hell, prices in heaven.
This divergence is the truly dangerous part.
Why did it rise despite the bad news?
Because the market had already priced in the bad news.
Within one hour after the PPI release, total liquidations across the network were only about $32.46 million. This number is far lower than the liquidation scale during the Asian session.
Meaning: most people had already exited or were prepared. When the actual data landed, no one panicked.
This is called "all bad news priced in."
But note, this is just the surface story.
The real story lies in the leverage data.
In the past 24 hours, total liquidations in the crypto market reached $929 million.
Among them, long liquidations were $777 million—accounting for 83.6% of total liquidations.
What does this mean?
It means before this rebound, longs had already been cleaned out once. Spot buying demand is severely lacking; the price is pushed up by "short covering," not by "real money buying."
Short covering creates a temporary vacuum, not a trend reversal.
Look at another detail.
Bitcoin ETFs saw a net outflow of about $681 million last week. Spot buying is withdrawing, leveraged longs are liquidating, yet the price is rising.
Do you call this a "bull market"?
This is a technical recovery after leveraged liquidations. The foundation is empty.
Friday, Bangkok.
Federal Reserve Chair Kevin Warsh will speak at the IMF annual meeting. This is his last public statement before the October 27-28 FOMC meeting.
The Fed enters a blackout period on Saturday; if the central bank wants to send signals, only Warsh himself can deliver them.
A Bank of America rate strategist bluntly said: investors are "waiting for Warsh to greenlight further rate hikes."
Current market pricing: 71.8% probability rates remain unchanged in October, 28.2% probability of a 25 basis point hike. But the cumulative probability of a rate hike by December has already soared to 92.8%.
Almost certain to hike before year-end.
This is the most painful part.
PPI at 6.3% is not retreating; it is accelerating. Energy prices are rising, tariffs are rising, AI chips are rising, shipping costs are rising. Inflation is not "transitory," it is sticky.
And Bitcoin’s $80,000 support relies not on fundamentals but on the vacuum after leverage clearing.
The market is not celebrating cooling inflation. It is celebrating "the worst data has already landed."
But 6.3% PPI is not the worst data.
It may be the prelude to the next round of worse data.
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