Bitcoin and the broader cryptocurrency market have bounced back again with the BTC price moving closer to $60,000 as the US CPI inflation data for July comes out ahead this week on August 15. With altcoins more prone to macro events, Ethereum and other altcoins have staged even stronger rallies gaining over 4%.
Bitcoin, Ethereum Stage Short Cover Rally
Just ahead of the crucial CPI inflation data release, the top two cryptocurrencies are showing strength in a major short-cover rally. In the last 24 hours, more than $177 million have been liquidated with $91 million in short liquidations and nearly $86 million in long liquidations.
As per the reports, the US CPI data is likely to show a surge in inflation fueling concerns about whether or not the Fed would proceed for a rate cut in September. Market estimates show that inflation for July is likely to surge by 0.2% against the 0.1% drop last month.
Over the past few weeks, the Bitcoin price has been oscillating in the range of $50,000-$60,000. Last weekend, a Bitcoin Death Cross signal appeared on the technical chart hinting at strong bearish sentiment. Some market analysts expect that BTC can take one more dive under $50,000 before resuming the next bull run.
As of press time, the Ethereum price is trading 4.70% up at $2,661 and a market cap of $320 billion. However, today’s short covering could be a dead cat bounce as technical indicators for altcoins don’t appear strong as well! Additionally, the massive ETH whale transfers with ICO time accumulation sends a negative market sentiment.
ETH/BTC Pair Rebounds
10X Research notes that ever since the September 2022 Merge event, the ETH/BTC pair has been moving in a downward trading channel and is experiencing a rebound ahead of the CPI release. While Ethereum developers continue to focus on building scaling solutions and the upcoming Pectra upgrade, the asset remains largely prone to macro developments in the global market.
“Previous upgrades, such as the Merge and Dencun, have had minimal impact on Ether’s price. Instead, ETH’s value continues to be primarily driven by macroeconomic factors like inflation,” noted 10x Research citing the below chart and similar observations during past events.
Courtesy: 10x Research
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Bhushan Akolkar
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
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