Bitcoin is dipping following a strong surge on Thursday, and the Fib support level is being examined. Ethereum’s price has found support around $1200 but is still restricted. The macroeconomic environment continues to push pricing.
Bitcoin and Ethereum Forecast: Neutral
As a result of the CPI print that was released this week, other risk assets continue to be under pressure, while Bitcoin and Ethereum continue to move within well-defined bands. As the prognosis for the macro economy continues to deteriorate, pressure is still applied to risk in general. The market has again re-priced its expectations for a rate rise by the Fed due to the hot CPI data from this week, which has further fueled worries of a probable recession.
While market benchmarks set new YTD lows in the whirlwind of price movement that followed Thursday’s CPI announcement, Bitcoin and Ethereum managed to keep their prices inside the well-defined channels they had already established. Following the release of the CPI report, a perplexing reversal occurred across the board for all risk assets during Thursday’s trading session. As Bitcoin’s price behavior continues to diverge from that of the Nasdaq 100, it seems to be living up to its reputation as an “uncorrelated risk asset.” This is shown by the fact that Bitcoin trades at a premium to its historical average.
2 HOUR BITCOIN CHART
BITCOIN (BTCUSD)
Following the premarket sell-off on Thursday morning, buyers were found for Bitcoin on a drop toward the support zone above $18000. As was the case with the vast majority of risk assets, Bitcoin produced a surprising recovery in the second part of the day, trading back above its levels from before the CPI was released. A robust risk-off tone on Friday caused BTC to give up some of those gains, and the price continued to fall near the $19225 fib support level.
Bitcoin continues to trade inside a defined range that spans from $18200 to $20400, and neither bulls nor bears have been able to take the “kill shot” so far. It is essential to take notice of Bitcoin’s failure to define a trend as of late since it looks to be immune (at least for the time being) from the carnage that is taking place throughout global financial markets. I believe there will be ongoing price volatility in the short term as market players trade from data point to data point, even though the price may eventually be heading down in the long run as we march into recession.
2 HOUR CHART OF ETHEREUM
ETHEREUM (ETHUSD)
Chop has dominated the market activity recently, and Ethereum is generally in the same position as Bitcoin. Even though Thursday’s drop was far more severe in Ethereum than in Bitcoin, the ETHUSD pair could solidly retrace the 7.7% CPI drop within hours. After failing to find buyers below $1160 over the last week, the price has moved back to a critical support level of around $1270.
Because the long-awaited network update is known as “the merge” turned out to be a “sell the news” sort of event, Ethereum has been experiencing significant difficulties since the upgrade was finally finished. Ethereum, having regained its footing, might attempt to challenge the swing high from October 6th around $1385 should any bids into risk assets materialize in the short term. If bearish pressure continues, we may return to where we started, around the $1270 support level.