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A Bitcoin whale has exited a massive short position following a lower-than-expected Consumer Price Index (CPI) report, signaling renewed optimism for Bitcoin’s price trajectory. The move comes just ahead of the Federal Open Market Committee (FOMC) meeting, as easing inflation concerns shape market sentiment.
Whale Nets $10 Million Profit on Bitcoin Short
A large crypto investor, commonly referred to as a whale, recently closed a high-leverage short position worth over $516 million. The 40x leverage trade, involving 6,210 BTC, yielded nearly $10 million in profit. This type of position functions as a bet against Bitcoin’s price, amplifying both potential gains and losses through borrowed capital.
Data from Hypurrscan reveals that the whale initially opened a $368 million position at $84,043 per Bitcoin. Had BTC surpassed $85,592, the position would have faced liquidation. To maintain the trade, the investor injected an additional $5 million, navigating an attempt by a publicly coordinated group of traders to trigger liquidation. Despite this, the whale managed to close the short position with a profit of $9.46 million.
Shift to Ether Following Bitcoin Exit
Following the successful exit from Bitcoin shorts, the whale reallocated profits into Ether, purchasing over 3,200 ETH for approximately $6.1 million at 7:31 am UTC on March 18, according to Etherscan data. This transition suggests a strategic shift in investment ahead of the FOMC meeting, where Federal Reserve policy decisions could significantly impact crypto markets.
Inflation Eases Ahead of Key Fed Meeting
The whale’s move aligns with a broader market trend following the release of February’s CPI data. The report indicated a 2.8% year-on-year increase, slightly below the expected 2.9%, hinting at easing inflationary pressures.
Fumihiro Arasawa, co-founder and CEO of xWIN Research, believes this CPI reading could influence Federal Reserve decisions and, by extension, Bitcoin’s price trajectory. “This suggests that inflationary pressures are gradually easing, which could influence the Federal Reserve’s monetary policy decisions,” Arasawa told.
Market analysts are closely watching Bitcoin’s ability to hold above the $81,000 support level. “A sustained hold could stabilize sentiment, while a breakdown may trigger further corrections,” Arasawa added.
Fed Policy Could Influence Bitcoin’s Next Move
With the FOMC meeting set for March 19, market participants are anticipating more clarity on the Federal Reserve’s policy direction for 2025. The latest estimates from the CME Group’s FedWatch tool indicate a 99% probability that interest rates will remain unchanged.
“The market largely expects the Fed to hold rates steady, but any unexpected hawkish signals could put pressure on Bitcoin and other risk assets,” said Ryan Lee, chief analyst at Bitget Research.
As investors brace for the Fed’s decision, Bitcoin’s near-term outlook remains tied to macroeconomic cues. A dovish stance could fuel further upside, while any hawkish surprises may introduce volatility into the market.
