Markets

How BTC and ETH may react

Published

7 months ago

12 July, 2024

Will the release of US CPI data signal a new era of monetary easing and how could this influence Bitcoin and Ethereum investments?

Bitcoin (BTC) and Ethereum (ETH) have been on a wild ride lately. Last week, BTC dropped more than 8% in a few hours to hit $53,600 as the now-defunct Mt. Gox began in motion large amounts of BTC to Japan-based exchange bitBank to reimburse customers.

This week, after recovering from the Mt. Gox refund saga and the German government’s BTC liquidation, BTC is now negotiation at $57,084 on July 12, despite a slight 2.3% drop in the last 24 hours.

Meanwhile, ETH have seen a high, trading at US$ 3,150, marking a gain of 1.78% in the same period.

Amidst this, the cryptocurrency market is now on edge, awaiting the next big trigger: the US Consumer Price Index (CPI) data, which will be released today.

This data is crucial as it reflects the cost of living in the world’s largest economy. Data from Dow Jones predict a 0.1% month-on-month increase in June, after May showed no change, leading to a 3.1% year-on-year increase.

Meanwhile, core CPI, which excludes volatile food and energy prices, is expected to rise 0.2% from June and 3.4% from the start of the year.

If these numbers are in line with expectations, it would indicate continued progress toward the Federal Reserve’s 2% inflation target, potentially paving the way for this year’s long-awaited rate-cutting cycle.

It’s worth noting that the inflation rate has fallen quite a bit since its 2022 peak of 9.1%, but the Fed remains cautious, needing to see more consistent progress before cutting interest rates.

At the same time, the response of the US Treasury yield curve to the expected soft CPI release could also play a key role in shaping market sentiment, including the cryptocurrency market.

The decline in long-term US Treasury yields I have been a critical factor, and any new twist in this trend could reverberate across financial markets, affecting cryptocurrencies.

With all these developments in mind, let’s dive deeper into what the market is expecting, what experts are expecting, and how the cryptocurrency market might react to these triggers.

Market expectations and potential direction of the cryptocurrency market

Earlier this week, Fed Chairman Jerome Powell delivered the Semiannual Monetary Policy Report. In his remarks, Powell suggested that cutting the benchmark interest rate would not be appropriate until there is greater confidence that inflation is moving sustainably toward the 2% target.

He also noted a cooling in recent labor market data. Despite those insights, Powell’s comments did not alter market expectations for a potential Fed rate cut in September.

Meanwhile, at the 2024 Australian Economists Conference, US Federal Reserve Governor Lisa Cook discussed the monetary policy response to the pandemic and the current inflation scenario. Cook noted that the data support potential rate cuts by the Fed, aligning with the approaches of other central banks.

She noted: “My baseline forecast (and that of many outside observers) is that inflation will continue to move toward target over time, without much further increase in unemployment.”

In this context, the CME FedWatch tool show an 84% probability of a 25 basis point (bps) rate cut on September 18, with another cut expected in December, in line with market expectations of a decline in CPI inflation data.

So what does this mean for crypto markets? The potential for rate cuts generally favors risk assets, including cryptocurrencies. Lower interest rates make borrowing cheaper, prompting investors to seek higher returns in riskier assets.

For example, if CPI data confirms continued declines in inflation, it could boost confidence in the Fed’s monetary easing. This could increase demand for BTC and other cryptos as investors seek assets that offer better returns than traditional savings accounts or low-yield bonds.

According to the latest data from Statista, the yield on a ten-year US government bond was 4.2%, while a two-year bond yielded 4.67%, indicating an inverted yield curve where longer-maturity bonds offer lower yields. In such scenarios, investors usually turn to riskier assets like BTC or ETH in anticipation of long-term gains.

Treasury Yield Curve | Source: Statist

However, any deviation from expected data could increase volatility. Higher-than-anticipated inflation could dampen hopes of a rate cut, causing a temporary drop in cryptocurrency prices as investors reassess their strategies.

What to expect in the coming days?

As the market eagerly awaits the latest US CPI data, two prominent cryptocurrency analysts have shared their insights on what the future holds for the cryptocurrency market.

An analyst tweeted about Bitcoin and the Wyckoff Reaccumulation Model, referencing a chart shared a week ago. This technical analysis framework suggests that after a consolidation phase, an asset’s price may increase.

#Bitcoin and the Wyckoff Reaccumulation Model.

I shared this chart exactly one week ago.

Do you see the similarities now? I hope you heard, family.

I guess we’ll see $BTC back above $60,000 very soon. photo.twitter.com/AHKgtOuxAY

— 𝕄𝕠𝕦𝕤𝕥𝕒𝕔ⓗ𝕖 🧲 (@el_crypto_prof) July 11, 2024

Drawing parallels to Bitcoin’s current pattern, the analyst predicts that BTC could soon rise back above $60,000.

Meanwhile, Michaël van de Poppe, another well-known crypto analyst, noted that Bitcoin recently broke above a crucial resistance level. However, he suggested that for BTC to gain momentum, it must break above the $60,000 mark.

#Bitcoin broke a crucial resistance, but needed to break $60,000 to gain any momentum.

CPI data will be released tomorrow, which will certainly move the market a lot. photo.twitter.com/BQGhXkzIp0

— Michaël van de Poppe (@CryptoMichNL) July 10, 2024

Van de Poppe also highlighted the upcoming CPI data as a critical factor in the market, suggesting that its release could heavily influence Bitcoin’s price action.

Combining these insights, the data suggests a potential upward move, with the $60,000 resistance level acting as a key cap on momentum.

It is crucial to closely monitor the release of CPI data. If the data indicates continued progress towards the Fed’s inflation target, it could boost confidence in a potential rate cut, positively impacting risk assets like BTC.

Always do thorough research and consider seeking guidance from financial professionals before making any moves in the cryptocurrency market.

Source

Markets

Crypto Markets Rebound as Spot Bitcoin ETFs Attract Massive Inflows

Published

6 months ago

17 July, 2024

FinCrypt Staff

Crypto Markets Rebound Ahead of Early Ethereum ETF Approval

This week saw $722 million worth of Bitcoin spot ETF inflows, including the largest daily inflow in a month.

Cryptocurrency markets rallied on Wednesday, driven by inflows into spot Bitcoin exchange-traded funds (ETFs).

The price of Bitcoin (BTC) is up 3% over the past 24 hours to last change hands at $65,200, according to CoinGecko. Ethereum (ETH) is up 2% and is trading at $3,471. Solana (SUN) and Polkadot (POINT) increased by 4%.

Bitcoin spot ETFs saw $422 million in daily inflows on Tuesday, the highest in the past 30 days, according to Far side data, . The all-time record for a single day was $1.05 billion on March 12.

Among Tuesday’s top contributors, BlackRock’s IBIT led with $260 million in inflows, followed by Fidelity’s FBTC with $61 million. This week has already seen more than $722 million in inflows.

Among the top 100 cryptocurrencies by market cap, Worldcoin (WLD) led with a 28% increase, followed by Helium (HNT) with 20% and Lido DAO (LDO) with 15%.

Worldcoin, a decentralized identity project led by OpenAI CEO Sam Altman, announced is extending the lockups for early investors and team members. This means that tokens will be gradually released through 2029, instead of the original 2027 plan. Token unlocks are generally seen as a negative because they increase supply and early investors can sell their tokens for profit.

Meanwhile, XRP, the token of the XRP Ledger network, jumped 8% after the CME and CF benchmarks introduced new indices and reference rates for XRP.

U.S. stocks faced a downturn on Wednesday. The S&P 500 fell 1%, while the Nasdaq Composite and Dow Jones Industrial Average both fell 2%.

Source

Markets

Altcoins on the cusp of a major breakout – WLD, AR, and INJ prices could surge by 20% in the coming days

Published

6 months ago

17 July, 2024

FinCrypt Staff

Altcoins on the cusp of a major breakout – WLD, AR, and INJ prices could surge by 20% in the coming days

Crypto markets appear to have been taken over by the bulls as major tokens have surged above their crucial resistance zone. Bitcoin surged above $65,000 while Ethereum was above $3,500, and XRP, which had remained passive for quite some time, surged over 40% in the past few days to hit $0.6. The uptrend has been captured in most altcoins, with Worldcoin (WLD), Arweave (AR), and Injective (INJ) leading the rally. Here’s what to expect for these tokens in the coming days.

Worldcoin (WLD) Price Analysis

O Worldcoin Price has been trading inside a descending wedge since it marked a new ATH near $12 in the final days of Q1 2024. The recent price action helped the price break out of the upper resistance of the wedge, breaking above the crucial resistance zone between $2.21 and $2.39. Market sentiments have changed, but technicals suggest that the bulls may remain passive for a while, which could offer some room for a bearish pullback.

The price broke out of the wedge with a significant increase in volume, but the current volume suggests that the bulls have taken a step back. Meanwhile, the RSI is about to reach the upper boundary, which could attract bearish forces. Additionally, the DMI has undergone a bullish crossover, but the decline in the ADX suggests that the rally may remain consolidated above the gains. Therefore, the WLD price is expected to maintain a horizontal consolidation between $3 and $3.3 and trigger a fresh rally to $4.4 during the next bullish rally.

Arweave (AR) Price Analysis

Arweave formed a strong base around $25, which helped the rally trigger a recovery during the bearish attack. Mt. Gox and German terror forced the price to fall below $20. However, the recent price action has brought the altcoin within the bullish range and raised expectations of maintaining a decent uptrend for a few more days.

AR price has hit one of the major resistances around $30 to $31.5, which could act as a strong base once overcome. The buying volume is slowly increasing, which could keep the bullish hopes for the rally high. Moreover, the supertrend has just flashed a buy signal, indicating a clean reversal of the trend. Therefore, AR price seems primed to maintain a healthy uptrend and rally above $40. However, if the bulls maintain a similar trend, making new highs above $50 may not be a tedious task for the bulls.

Price Analysis of Injective (INJ)

Injective price has been showing sharp strength since the beginning of the year and hence, the recent turnaround is expected to revive a good uptrend going forward. The bears engulfed the rally to a large extent, but the recent price action suggests that the bulls have regained their dominance. Therefore, INJ price is expected to maintain a strong uptrend with a bearish interference on the way down.

INJ price has surged above the lower support zone and has registered consecutive bullish candles. Although the volume is below the required levels, the OBV is maintaining a sharp uptrend. Furthermore, the Ichimoku cloud lead span B is heading towards the lead span A and a healthy crossover indicates the start of a new uptrend. However, INJ price may be out of the bears’ reach once it secures the resistance zone between $30.77 and $32.12, which seems to be on the horizon.

Source

Markets

Ethereum at $3.5K, Exchange Supply Hits 34-Month High

Published

6 months ago

17 July, 2024

FinCrypt Staff

Ethereum at $3.5K, Exchange Supply Hits 34-Month High

Ethereum (ETH) supply on exchanges has hit a 34-month high as the asset’s price surpassed the $3,500 mark.

ETH has risen 2.3% over the past 24 hours and is trading at $3,490 at the time of writing. The second-largest cryptocurrency — with a market cap of $419 billion — briefly touched an intraday high of $3,517 earlier today.

ETH Price, Whale Activity, RSI, and Exchange Supply – July 17 | Source: Santiment

Ethereum’s daily trading volume also increased by 7.6% to reach $19.8 billion.

According to data provided by Santiment, the supply of Ethereum on exchanges has reached $19.52 million ETH. This level was last seen in September 2021, when the asset was trading around the same price.

On the other hand, data from the market intelligence platform shows that the number of whale transactions has fallen by 12% in the last day — falling from 8,730 to 7,629 unique transactions per day.

The move shows that the supply of Ethereum on exchanges has been increasing with small deposits rather than large transactions from whales.

Additionally, the ETH Relative Strength Index (RSI) is currently hovering at the 60-mark, per Santiment. The indicator shows that Ethereum is slightly overbought at this price point, but it may not be in a critical position due to its large market cap.

One of the main drivers of Ethereum price increase is ETH spot expectations ETFs in the US Investment products are scheduled to start trading on July 23rd.

Source

Markets

Bits + Beeps: How to Play the ‘Trump Trade’ in Cryptocurrencies After the Assassination Attempt

Published

6 months ago

17 July, 2024

FinCrypt Staff

Bits + Bips: How to Play the ‘Trump Trade’ in Crypto After the Assassination Attempt

Also, how much will the Fed cut rates (and when)? What will be the inflows into ETH ETFs? And what is the near future for Bitcoin?

Posted on July 17, 2024 at 12:00 PM EST.

Listen to the episode at Apple Podcasts, Spotify, Capsules, Source, Podcast Addict, Pocket molds, Amazon Musicor on your favorite podcast platform.

In this episode of Bits + Bips, hosts James Seyffart, Alex Kruger and Joe McCann, joined by guest Jack Platts, dive into the market reaction to the recent assassination attempt on former President Donald Trump, analyzing how this event will influence the 2024 US presidential election and the cryptocurrency markets.

They also cover potential rate cuts: Could there be a cut in July? How big could the September rate cut be? Could the decision be influenced by the upcoming election?

They also give their predictions on what percentage of BTC ETF inflows the ETH ETFs will reach, and James talks about what he expects for Grayscale’s ETHE (hint: his outlook would be positive for ETH).

Finally, they delve into what’s next for Bitcoin as the German government runs out of BTC and Mt. Gox distributions begin. Just now?

Program Highlights:

Whether Trump’s shooting decided the election and whether the event caused a “flight to safety”
How election markets are becoming a place to watch election probabilities and whether cryptocurrencies “lean right”
Whether rate cuts will occur in July or September and by how much they will cut: 25 bps or 50 bps
How Joe sees the relationship between global liquidity cycles, rate cuts, and the potential rise of Bitcoin
What are the new updates about Ethereum ETFs and their expected launch?
Why Solana Hasn’t Performed Significantly Better Since Trump News
What Market Breadth Indicates About the Current Market Rally and the Impact of Rates on Small Caps
Everyone’s predictions on ETH ETF inflows and how much outflow we’ll see on Grayscale’s ETHE
What’s Next for BTC After German Government Exits Bitcoin and Mt. Gox Giveaways Starting This Week