The cryptocurrency market has been volatile in recent weeks Bitcoin And Ethereum Experiencing significant price swings. Traders and investors are closely monitoring the impact of macroeconomic data on digital asset prices. Today, all eyes are on the US Consumer Price Index (CPI) and retail sales data, which are expected to provide insight into the strength of the US economy and inflationary pressures.
Fundamental outlook of the crypto market
Bitcoin and Ethereum have experienced significant gains in recent weeks, with BTC rising to a nine-month high above $26,000 and ETH breaking the key $1,700 resistance level. However, their upward move can be attributed to mildly encouraging inflation data released earlier and the financial industry’s continued recovery from a near-catastrophic disaster.
The latest data show that US consumer inflation has eased, but it still remains at a high level. This could prompt the Federal Reserve to maintain its accommodative stance. If macroeconomic factors remain favorable, bitcoin may soon have the potential to reach the $30,000 mark.
Despite giving back some of its early gains, bitcoin still remains over 80% from its lowest point. Currently, bitcoin and ETH are trading at $24,900 and $1,700 respectively. These bullish market movements suggest that the digital currency market is experiencing positive sentiment.
Furthermore, the rally in bitcoin price gained further momentum after the UK government expressed its support for the Silicon Valley bank. The news triggered favorable sentiment among investors, leading to an increase in buying activity.
The increase in the value of BTC shows a positive sentiment towards the digital currency industry. As such, investors should closely monitor market developments before making any significant investment decisions.
Effect of CPI on Bitcoin Price
The recent release of the Consumer Price Index (CPI) data for February 2023 by the US Department of Labor has had a significant impact on the Bitcoin price.
The CPI measures the average change in consumer prices for a basket of goods and services, and it rose 0.4% last month on a seasonally adjusted basis.
However, the all-item index of inflation rose by 6% over the previous year, which has raised concerns among investors.
Although the publication of the CPI data caused turbulence in traditional markets, cryptocurrency markets reacted positively, with bitcoin and ethereum experiencing price increases. This indicates that investors are turning to digital assets as a potential inflation hedge.
It’s worth noting that the CPI is an important tool for assessing economic performance, setting monetary policy, and adjusting wages, benefits and Social Security payments for inflation. As a result, rising inflation could prompt the Federal Reserve to take a more accommodative stance.
As a result, traditional financial markets could be negatively impacted if the Fed decides to raise interest rates in response to rising inflation. On the contrary, it may encourage more people to invest in bitcoin and other cryptocurrencies as an alternative investment option.
While the rise in inflation is undoubtedly a matter of concern, it is not clear how it will affect the global economy in the long term. Nevertheless, the surge in bitcoin price following the release of the CPI data suggests that the digital asset is gaining acceptance as a viable inflation hedge in the short term.
Forecast for the US February Retail Sales Report and Its Potential Impact on Bitcoin Price
The US Census Bureau is set to release the February retail sales report on March 15. Economists and researchers from eight major banks have provided their forecasts for the upcoming data.
US retail sales are expected to decline 0.3% year-over-year, a significant decline from January’s 3.0% growth. However, excluding autos, sales are forecast to rise 0.2%, down from 2.3% in January. Additionally, the control group used for GDP calculation is projected to decline by 1.2%, compared to a 1.7% increase in January.
It’s worth noting that retail sales data is an important indicator of the health of the US economy, as consumer spending is a significant portion of GDP. Therefore, an expected drop in retail sales could signal a recession in the US economy, which could potentially have a negative impact on traditional financial markets. However, cryptocurrencies such as bitcoin are likely to benefit as investors may seek alternative assets in times of economic uncertainty.
As a result, the impact of retail sales data on BTC price will depend on how investors interpret the news. A larger-than-expected drop in retail sales could drive BTC price higher as investors seek safe-haven assets.
Conversely, better-than-expected sales figures could push BTC price lower as investors shift their focus back to traditional assets. Overall, the upcoming release of retail sales data is expected to have a significant impact on the financial markets and could affect the price of BTC in the near term.
bitcoin price
At the level of $24,850 on Wednesday, BTC/USD The pair exhibited a bullish trend. On the upside, bitcoin may face immediate resistance near the $25,250 level. If this level is crossed, there could be more buying opportunities with a move towards $26,700.
However, if bitcoin breaks the immediate support at $24,000, it could result in further selling pressure, potentially sending the price towards the $23,750 level. If the price breaks above $25,225 today, the traders can consider buying a buy position.
ethereum price
present value of Ethereum $1,700, and it is currently facing a strong resistance near the $1,710 level, with a double top pattern extending this resistance. A break above this level could expose ETH price towards the $1,800 mark.
On the downside, an immediate support for Ethereum lies at the $1,600 or $1,495 marks. Investors will be keeping a close eye on US CPI and retail sales data today.
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Check out Cryptonews’ Industry Talk team’s curated list of the top 15 altcoins to watch in 2023. The list is frequently updated with new ICO projects and altcoins, so be sure to check back often for the latest updates.
Disclaimer: The Industry Talks section features insights by crypto industry players and is not part of the editorial content of 0x0news.com.
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