The flagship cryptocurrency hits its highest level in more than two months as inflation is expected to rise by another 0.5% in July. Bitcoin (BTC) reached its highest level in more than two months, with just a few days remaining before the July inflation report.
The top cryptocurrency climbed 1.65% to $45,363 on Sunday, continuing the upside momentum that had already seen it jump 21.62% from its low of $37,300 on Thursday.
Momentum was strong among Bitcoin rivals as well. Ether (ETH), the second-largest crypto by market capitalization, increased 29.78% from its low of $2,630 on Tuesday, crossing $3,100 on Sunday. Its gains came after Ethereum’s London hard fork went live on Thursday, which should add deflationary pressure to the supply of ETH.
On Wednesday, the United States Bureau of Labor Statistics will release July’s inflation report, with markets forecasting a 0.5% spike. The projections appear after the consumer price index (CPI) jumped to 5.4% year-over-year in June to log its biggest increase in 13 years.
Bitcoin bulls have responded positively to the recent inflation reports. They effectively guarded the cryptocurrency against falling below $30,000 after the May 19 crash. Meanwhile, their recent efforts to push the prices above $40,000 — eventually leading into a slow upside break above $45,000 — indicate strong demand for Bitcoin, which appears to be breaking out of its summer slump.
Lex Moskovski, chief investment officer of Moskovski Capital, highlighted a Glassnode chart that showed dramatic spikes in entities entering the Bitcoin network, matching the growth with the rising BTC/USD rates. “Amount of new Bitcoin entities continues to hit all-time high,” Moskovski tweeted.
Additionally, on-chain analyst Willy Woo said the ongoing Bitcoin momentum should push its prices above $50,000, citing a supply-and-demand imbalance in the market. He said that all investor cohorts were buying Bitcoin, which led to a supply shock.
Woo referred to a chart he posted on July 15 when Bitcoin’s market corrected lower after having peaked at $36,675. The graph, as shown below, highlighted events of Bitcoin’s liquidity shock across all the exchanges and their relation to the prices.
Woo explained: “Fundamentals do not predict short term price, but given enough time price discovery reverts to fundamentals. Exact value is $53.2k today, with a standard deviation band between $39.6k - $66.8k (68.5% confidence).”
However, the latest Bitcoin climb does carry risks of becoming a dead cat bounce, based on previous top-to-bottom Fibonacci retracement fractals. After setting up record highs, Bitcoin tends to correct toward its 200-week exponential moving average (200-week EMA; the yellow wave), where it eventually bottoms out to pursue another bullish cycle.
In the past two events, the BTC/USD exchange rate posted fake recovery rallies after testing the 23.6 Fib line as support. Those upside moves failed short of turning into big bullish momentum after facing resistance at higher Fib levels.
For instance, in 2019, Bitcoin rebounded by more than 50% after bouncing off from its 23.6 Fib line near $7,357. But the cryptocurrency faced extreme selling pressure near its 61.8 Fib line of $10,613. Eventually, it resumed its downtrend and crashed to as low as $3,858 in March 2020.
If the fractal repeats, Bitcoin could face extreme resistance at the 61.8 Fib level at $46,792 and correct lower to retest its 200-day EMA, which currently sits below $20,000. ndependent market commentator and trader Keith Wareing suggested that an imminent bullish crossover between Bitcoin’s two weekly moving averages is hinting at the beginning of a multi-month bull run. Dubbed as the moving average convergence divergence (MACD), the indicator was instrumental in predicting the 2020 bull run.
“The weekly MACD is due to cross bullish on Bitcoin after tonight’s close,” opined Wareing to his Twitter followers, with the price of Bitcoin so far maintaining above $44,500 at the time of writing.
|#||Crypto||Prediction||Accuracy||CVIX||Price||24h||7d||Market Cap||7d price change|
|1||BTC||Bitcoin predictions||70.8%||61||$27 840.71||1.21%||-0.56%||$538 129 695 575|
|2||ETH||Ethereum predictions||78%||45||$1 767.58||1.19%||-2.66%||$216 305 397 091|
|3||USDT||Tether predictions||94%||1||$1.000675||-0.02%||-0.22%||$79 075 659 998|
|4||BNB||Binance Coin predictions||70.4%||55||$327.63||1.31%||-3.17%||$51 729 397 468|
|5||USDC||USD Coin predictions||90.8%||2||$0.999850||0%||-0.01%||$33 908 036 023|
|6||XRP||XRP predictions||79.2%||31||$0.448514||-2.25%||14.10%||$22 852 174 189|
|7||HEX||HEX predictions||61.6%||82||$0.083472||-7.12%||-4.02%||$14 474 941 650|
|8||ADA||Cardano predictions||75.6%||39||$0.355402||-0.43%||1.86%||$12 343 469 988|
|9||STETH||Lido stETH predictions||96%||1||$2 941.39||-0.40%||-3.32%||$10 258 752 564|
|10||MATIC||Polygon predictions||73.2%||45||$1.096341||0.35%||-8.87%||$9 955 292 481|
|11||DOGE||Dogecoin predictions||78%||42||$0.074572||-0.20%||-1.62%||$9 893 472 420|
|12||BUSD||Binance USD predictions||92.8%||1||$0.999729||-0.01%||-0.10%||$8 022 170 532|
|13||SOL||Solana predictions||72.8%||46||$20.85||0.67%||-5.99%||$8 004 990 448|
|14||DOT||Polkadot predictions||79.6%||39||$6.03||0.57%||-7.80%||$7 053 783 531|
|15||LTC||Litecoin predictions||74%||57||$93.16||0.89%||9.35%||$6 760 087 916|
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