ETH Surges 7%, Squeezes Shorts as CPI Shrugs

Mixed inflation data flipped market mood from risk-off to risk-on — and ETH's crowded short trade paid the price.

By The crypto-money Desk

Ether jumped as much as 7% on Friday, trading above $2,600 and leaving the rest of the crypto majors behind — BTC barely moved at +0.33%, while SOL, HYPE, and ZEC each clocked roughly +2% [1].

The catalyst was a mixed CPI print: a hotter headline number offset by a cooler core reading, which markets appear to have treated as already priced in [1]. That read flipped sentiment from Thursday's PPI-driven jitters back toward risk-on, generating buy pressure that quickly became a short squeeze [1].

ETH shorts had become a crowded trade again, and the bounce forced hundreds of millions in liquidations — with one outsized position wipeout on Hyperliquid doing a lot of that damage alone [1].

When a narrative and a mechanics story collide, the move tends to be sharper than either alone would justify. ETH's session illustrated exactly that compression — sentiment shift amplified by forced selling on the other side.

The path forward narrows quickly: traders are now betting the Fed will raise rates at next week's FOMC meeting, with odds jumping to the mid-to-high 80% range after Friday's data, up from around 70% the day before [1]. If that rate hike happens and the Fed signals more are coming, the rally could stall; yet if Fed Chair Warsh sounds less aggressive when he speaks afterward, ETH's strength could just as easily keep going [1].

One session doesn't make a trend, but the mechanics — buy pressure, squeeze, liquidation cascade — are now on the board. The next move belongs to the Fed.