- Bitcoin nears $60,000 amid a short-covering rally as CPI data looms, with over $177M in liquidations in 24 hours.
- Ethereum rises 7.7% to $2,637 despite weak technical indicators, with significant ETH whale transfers contributing to negative sentiment.
- U.S. CPI data on August 15 is expected to influence the Fed's rate decision, potentially impacting future trends in the cryptocurrency market.
A significant upswing is underway in both Bitcoin and the larger cryptocurrency market as investors await the release of the U.S. Consumer Price Index (CPI) data on August 15.
As worries about inflation grow, the price of Bitcoin has risen toward $60,000, while altcoins like Ethereum have experienced even greater gains. The market is more volatile today due to the expectation of the important inflation data, which is why prices are rising.
Bitcoin Approaches $60,000 Amid Short-Covering Rally
The value of Bitcoin, the biggest cryptocurrency in the world, has been hitting between $50,000 and $60,000 in recent weeks. The price of Bitcoin is moving in the direction of this range's upper limit as of the most recent trading session.
The short-covering rally, which has resulted in liquidations totaling over $177 million in the last day alone, is largely responsible for this movement. Of this, $91 million came from short positions, indicating a brief change in the sentiment of the market.
Some analysts, though, warn that this rally might not last long because technical indicators continue to point to a bearish outlook. There are rumors that Bitcoin might fall below $50,000 once more before maybe starting to rise again.
Ethereum Leads Altcoin Surge Despite Weak Technicals
Ethereum's price has also increased significantly, going up 7.70% to $2,637 in the last week. Even with this encouraging development, Ethereum's future is still unclear. Technical indicators for the altcoin point to weakness, despite the fact that the recent price spike suggests strong demand.
The market's negative sentiment is being exacerbated by the existence of massive ETH whale transfers, which frequently signal large-scale sell-offs. Moreover, macroeconomic variables such as the impending release of CPI data, continue to have a significant impact on Ethereum's price.
The ETH/BTC pair has been declining since the September 2022 Merge event, and it has only lately begun to rise ahead of the inflation data.
Inflation Data and Fed Decisions Hold the Key to Future Trends
It is anticipated that the forthcoming U.S. CPI data will be crucial in dictating the future course of the cryptocurrency market. According to market estimates, inflation may increase by 0.2% in July, reversing a 0.1% decrease from the previous month.
Fears about whether the Federal Reserve will decide to cut interest rates in September have intensified in response to this possible spike in inflation. The market may be greatly impacted by the CPI data release's outcome, which could either strengthen the current rally or spark more sell-offs.
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