• Bitcoin and major alternative cryptocurrencies (altcoins) trade weak ahead of the pivotal U.S. CPI release.

• One observer said the pullback could soon run out of steam as selling pressure from wallets with a history of holding coins for the long term is weakening.

Bitcoin {{BTC}} is on the defensive under $69,000, nursing a 2.5% drop on a 24-hour basis, having briefly climbed to a high of $69,300 during the Asian trading hours.

Profit-taking from Monday continued as several major tokens slid lower. Ether and Solana’s SOL lost 2.8% and Cardano’s ADA and dogecoin (DOGE) slumped as much as 4%. BNB Chain’s BNB was the only token in green with a slight 1.8% rise.

The broad-based CoinDesk 20, a liquid index of the biggest tokens, excluding stablecoins, was down 3%.

The Asian session demand for bitcoin and leading altcoins represented trade optimism, FxPro Senior Market analyst Alex Kuptsikevich told CoinDesk in a message, warning of potential volatility explosion following the release of the U.S. consumer price index later Wednesday.

“The U.S. CPI report, which in recent years has caused a spike in volatility comparable to NFP [nonfarm payrolls report], has an impressive potential to influence the market on Wednesday,” said Kuptsikevich.

Still, some analysts said bitcoin correction could be over. Selling pressure from certain long-term wallets seems to have cooled in recent weeks, alongside a bump in demand for spot bitcoin, on-chain analysis firm Glassnode said in a Tuesday report.

“Bitcoin’s strong performance over the last 12 months is supported by a surge in spot trade volume and exchange deposit and withdrawal volumes,” analysts at blockchain data tracking firm Glassnode wrote. “Profit-taking by long-term holders spiked meaningfully into the $73k ATH and has been cooling down in recent weeks. This comes alongside an uptick in new demand brought on by the U.S. spot ETFs.”

The firm defines long-term holders as wallets that keep a token for more than 155 days instead of trading over weekly or daily periods.