Bitcoin
BTC$19 477.75

4.45%

Ethereum
ETH$1 335.97

4.93%

Tether
USDT$1.000060

0.01%

USD Coin
USDC$1.000123

0.01%

Binance Coin
BNB$280.78

4.22%

XRP
XRP$0.440273

4.36%

Bitcoin rebounds from $33K-support as US dollar inflation comes back into focus


13 Jul 2021

#Bitcoin

Bitcoin moved inversely to the dollar at the beginning of this week as traders awaited the June CPI report due Tuesday. Bitcoin (BTC) prices steadied on Tuesday after closing the previous session at a 3.41% loss, supported by a weakening dollar sentiment ahead of a key United States' inflation report due later today. Spot BTC/USD exchange rate rose by a modest 1.31% to $33,096 after bottoming out on Monday at $32,996 on Coinbase exchange. The CME Bitcoin Futures was up 1.64% from its previous session's low of $32,600.

Meanwhile, the US dollar index was down about 0.03% ahead of the London opening bell. The index represents the greenback's strength against a basket of top foreign currencies.

Inflation data awaited

Bitcoin and the dollar moved inversely in the week of key inflation reports and a crucial congressional testimony from the Federal Reserve Chairman Jerome Powell. On Tuesday, the US Consumer-Price Index (CPI) expects to post another significant spike in June, highlighting a run-up in inflation as the economy attempts to recover from the coronavirus pandemic slowdown. A Reuters poll of economists noted that the CPI might have increased by 0.5% from May and 4.9% from a year earlier.

Many traders bet on Bitcoin against the prospects of higher inflation, partly due to popular narratives that project the flagship cryptocurrency as a hedge against central banks' inflationary policies that hurt fiat currencies' purchasing power.

In detail, the Federal Reserve has been running a $120 billion monthly asset purchase program since March 2020 while keeping its benchmark lending rate near zero. As a result, the U.S. central bank's policies have doubled the size of its balance sheet to more than $8 trillion. Meanwhile, the same period has witnessed Bitcoin spiking by up to 1,528%—from $3,858 to almost $65,000.

The cryptocurrency declined by more than half by the said mid-April peak but sustained its overall bullish bias by relentlessly holding $30,000 as its psychological price floor. The support came extremely handy following the previous two CPI reports showing that inflation jumped to 4.2% in April and 4.9% in May.

"The uptick in the CPI readings is an indication that the economy has not healed completely from the pangs of the pandemic, and the crypto market is trailing the negative inflation figures," Gustavo De La Torre, director of business development at N.exchange, told Cointelegraph. He added that lower Bitcoin prices combined mixed economic outlook would drive more investors to accumulate the cryptocurrency. "Should the buyup intensify, a price push up to $40,000 for Bitcoin may be seen in the short term," added De La Torre.

Additionally, Konstantin Anissimov of CEX.IO warned about Fed's potential hawkish reaction to further inflation hikes, noting that it might prompt the central bank to unwind its bond-buying program and cut interest rates earlier than expected.

"As things stand, the Federal Reserve has increased the size of its balance sheet from early 2020 to more than $8 trillion — a substantial rise," Anissimov said, adding that lower crypto prices would keep serving as the right hedge against inflationary fears for the time being. He further noted: "Both Bitcoin and Ethereum with the renewed buy-ups are likely to retest new price levels at $45,000, and $3,000, respectively."

Bitcoin enters accumulation

On-chain indicators continued to point towards an ongoing Bitcoin accumulation. As of the last week's close, as per Glassnode's data, entities with little history of selling continued piling up Bitcoin from weaker hands, while net exchange flows dipped into negative territory, suggesting that traders have been withdrawing their Bitcoin from trading platforms to hold.

"Retail has been buying heavily for weeks now, but we finally got the uptick in whales that we were waiting for," noted Will Clemente, an independent market analyst. "There were 17 new whales birthed on the blockchain this week, while at the same time the overall holdings of whales increase up by 65,429 BTC."


Related

Has the crypto market first felt the risk appetite?
Has the crypto market first felt the risk appetite?
Bearish Sentiment Persists
Bearish Sentiment Persists
The crypto market has taken a hiatus from the sell-off
The crypto market has taken a hiatus from the sell-off
Crypto bears confirmed their strength
Crypto bears confirmed their strength
Cryptocurrencies: Main Week of the Calendar
Cryptocurrencies: Main Week of the Calendar
Is Bitcoin heading to $15K? Why are the markets suddenly pulling back?
Is Bitcoin heading to $15K? Why are the markets suddenly pulling back?
Crypto market's fragile stability
Crypto market's fragile stability
Bugatti Sports Car for 1 BTC: a Pipe Dream or Reality?
Bugatti Sports Car for 1 BTC: a Pipe Dream or Reality?
The crypto market tests the strength of buyers
The crypto market tests the strength of buyers

Top Cryptocurrencies with Price Predictions

# Crypto Prediction Accuracy CVIX Price 24h 7d Market Cap 7d price change
1 Bitcoin (BTC) BTC Bitcoin predictions 87.6% 23 $19 477.75 4.45% 1.63% $373 264 823 304 BTC 7 days price change
2 Ethereum (ETH) ETH Ethereum predictions 66.8% 71 $1 335.97 4.93% 3.54% $163 755 405 431 ETH 7 days price change
3 Tether (USDT) USDT Tether predictions 92.8% 1 $1.000060 0.01% 0% $67 960 262 498 USDT 7 days price change
4 USD Coin (USDC) USDC USD Coin predictions 96% 1 $1.000123 0.01% 0.01% $48 707 702 464 USDC 7 days price change
5 Binance Coin (BNB) BNB Binance Coin predictions 86% 15 $280.78 4.22% 4.60% $45 299 859 595 BNB 7 days price change
6 XRP (XRP) XRP XRP predictions 59.6% 83 $0.440273 4.36% 3.80% $21 969 915 706 XRP 7 days price change
7 Binance USD (BUSD) BUSD Binance USD predictions 90.8% 1 $1.000647 0.05% -0.01% $21 055 852 896 BUSD 7 days price change
8 Cardano (ADA) ADA Cardano predictions 80% 35 $0.437309 2.31% -3.28% $14 973 500 079 ADA 7 days price change
9 Solana (SOL) SOL Solana predictions 81.2% 31 $33.70 5.17% 4.85% $11 957 820 597 SOL 7 days price change
10 Lido stETH (STETH) STETH Lido stETH predictions 93.6% 1 $2 941.39 -0.40% -3.32% $10 258 752 564 STETH 7 days price change
11 Dogecoin (DOGE) DOGE Dogecoin predictions 88.4% 16 $0.060417 1.68% 2.72% $8 015 516 955 DOGE 7 days price change
12 Polkadot (DOT) DOT Polkadot predictions 70.8% 55 $6.44 2.66% 0.22% $7 223 798 979 DOT 7 days price change
13 Dai (DAI) DAI Dai predictions 94% 1 $0.999736 0.02% -0.07% $6 861 849 280 DAI 7 days price change
14 Polygon (MATIC) MATIC Polygon predictions 69.6% 62 $0.745555 3.08% -0.82% $6 511 915 521 MATIC 7 days price change
15 Wrapped TRON (WTRX) WTRX Wrapped TRON predictions 94.4% 5 $0.060062 1.88% 0.71% $6 106 889 160 WTRX 7 days price change

Be the first to receive Cryptocurrency Price Predictions and Forecasts daily

Get cryptocurrency price predictions, forecasts with analysis and news right to your inbox.

© 2015-2022 Crypto-Rating.com

The usage of this website constitutes acceptance of the following legal information. Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website, including information about the cryptocurrencies and bitcoin is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Crypto Rating shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about cryptocurrencies. The entire responsibility for the contents rests with the authors. Reprint of the materials is available only with the permission of the editorial staff.