Bitcoin (BTC) has plunged a little deeper in the past 24 hours. The market expects this in anticipation of the next release of the US Consumer Price Index (CPI).
These inflation figures will be released later today and are making investors very cautious at the moment. Trading volume is declining again and fear is on the rise.
Bitcoin Fear and Greed Index is 31 – Fear
Current price: $23,038 pic.twitter.com/5YyZVOdzaz
— Bitcoin Fear and Greed Index (@BitcoinFear) August 10, 2022
Bitcoin price drops by 3.8%
The bitcoin price made a significant increase on Monday morning, but was then, just like a few weeks ago, rejected just above USD 24,000.
Bitcoin also failed to hold above USD 23,800 yesterday morning and the price started to fall sharply. Bitcoin seemed to find some hold around $23,200, but also fell through last night, eventually reaching a low around $22,800. Bitcoin even dipped below $22,700 on several exchanges.
Bitcoin has been on the rise for the past few hours. The BTC price currently stands at $22,990 on KuCoin and $22,530 on Bitvavo. This means that the BTC price is currently 3.8% in the minus.
Bitcoin back to 200-week moving average
That means bitcoin has once again fallen back to that infamous 200-week moving average, which is currently around $22,960. This frontier recently served as resistance for the first time in bitcoin history, but recently seemed to have bounced back to support. Can Bitcoin Hold Up Here Again?
Instead of choosing to focus on either the 200 week EMA or SMA, why not use both?
— Caleb Franzen (@CalebFranzen) August 9, 2022
This was also the zone where whales have been buying heavily this summer, reports analyst Whale Map. That should now strengthen support in this area. Analyst Whale Map therefore wonders if we will see another bounce from this point.
$BTC is back to the whale accumulation area.
Prices where whales accumulate usually act as support or resistance for price action of #Bitcoin.
Question is, will we get a bounce again or go deeper. pic.twitter.com/MDBscUOucj
— whalemap (@whale_map) August 9, 2022
Bearish signals for bitcoin
Analyst BTCfuel, on the other hand, warns that the relative strength index (RSI) is creating a so-called rising wedge pattern. In the past, this led to a correction. According to the analyst, the price may even fall below $19,000.
— BTCfuel (@BTCfuel) August 9, 2022
Also the so-called funding rate for bitcoin derivatives turns negative again. It shows that investor sentiment is more bearish is becoming. However, it can also lead to a short squeeze.
— IT Tech (@IT_Tech_PL) August 9, 2022
US CPI keeps bitcoin market in suspense
The US CPI is today at 14.30 published. So it can be a very exciting day for crypto: the bitcoin price has reacted quite strongly to these inflation figures several times this year.
The market hopes that inflation in the US, which stood at 9.1% last month, has now peaked. Inflation is expected to have fallen to 8.7%, although that is of course still very high. If inflation turns out to be between 8.7% and 9.1%, the market reaction is likely to be better than expected.
However, if inflation does turn out higher, panic may strike again. The market, on the other hand, will speculate about extreme rate hikes and investors will draw their money from more risky assets.
If inflation turns out to be even lower, the markets could well rise. Note that there is no Federal Open Market Committee (FOMC) meeting this month. It won’t be until mid-September.
CPI prints have been pretty pitoval for BTC price action. Big day tomorrow innit. pic.twitter.com/xUUTAhd0Lf
— Will Clemente (@WClementeIII) August 9, 2022
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