CPI Print Pushes Crypto Into Red Zone, Here Are 2 Potential Scenarios
June 10 2022 - 2:00PM
NEWSBTC
The crypto market is retesting critical support areas as the U.S.
Consumer Price Index (CPI) print surpasses expectations. The metric
is used to measure inflation in the U.S. dollar, and it recorded an
8.6% increase year-over-year (YoY), the highest since 1981. Related
Reading | TA: Bitcoin Bears Keep Pushing, Why BTC Could Still
Nosedive This could turn the U.S. Federal Reserve (FED) more
aggressive in its attempts to stop inflation. The financial
institution began tightening its monetary policy which has
translated into a reduction in global liquidity, and negative
performance for risk-on assets, such as Bitcoin. The price of
Bitcoin is back at $29,400 with a 3% and 3.5% loss in the last
24-hours and 7-days, respectively. The cryptocurrency made several
attempts at returning to previous highs, but market conditions have
contributed to an increase in selling pressure. A pseudonym trader
presented two potential scenarios for Bitcoin in the coming months.
The trader claims the market seems to have two targets in mind for
the price of the number one crypto: either more downside to $20,000
or a push upwards to $40,000. As seen below, this trader believes
Bitcoin could drop to $25,000 before returning to its current
levels. This scenario contemplates Bitcoin forming a new range
between its yearly lows and the low $30,000. The number one
cryptocurrency, and the crypto market cap, might seem some relief
later this year. However, rising inflation with a hawkish FED cast
a long shadow over the bulls. The second scenario contemplates a
longer BTC price range, but with less volatility. The trader said
the following about these potential scenarios: These scenario’s
would make for a painful and slow crab market throughout the
summer. The space would end up feeling dead and empty. Right in
time for some positive changes in terms of the macro landscape
later on which could be the bullish catalyst for a breakout. Can
Bitcoin And Crypto See New Highs In 2022? As inflation in the U.S.
seems to spiral out of control, the U.S FED will continue to
tighten by reducing their balance sheets and increasing interest
rates. Consequently, the crypto market could experience steeper
losses. Over the past months, as macro-economic uncertainty rises,
Bitcoin dominance followed with an upward trend. As NewsBTC
reported, this metric stood north of 40% in the past 7-days but
could return to its 2020 levels. At the time, Bitcoin alone formed
above 60% of the total crypto market capitalization. If the
economic narrative turns its attention from reducing inflation to
stopping a potential global recession, Bitcoin and the crypto
market could see some relief. This scenario seems likely to play
out by the end of the year. Related Reading | TA: Ethereum
Holds Key Support, Why ETH Must Clear This Hurdle In any case, new
highs seem unlikely for the crypto market. However, market
participants should keep an eye out for a shift in narratives as
they could signal potential bullish momentum.
Mina (COIN:MINAUSD)
Historical Stock Chart
From Apr 2024 to May 2024
Mina (COIN:MINAUSD)
Historical Stock Chart
From May 2023 to May 2024