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With the Ripple lawsuit making progress and US consumer (CPI) and producer (PPI) prices falling, the Bitcoin and cryptocurrency market saw significant price increases last week. Alternative currencies including Solana (SOL), Cardano (ADA), and Polygon (MATIC) saw double-digit rises as a result of Ripple’s positive court decision.
The leading cryptocurrency, Bitcoin, momentarily surpassed its previous yearly high at $31,840, but it was unable to maintain the positive burst. The week’s final trading session saw a majority of profit-taking despite positive US economic statistics. As a new trading week begins, attention is turned to the US Dollar Index (DXY) and its possible effects on Bitcoin and cryptocurrency markets.
The DXY Is Highlighted
However, as the US dollar index is at a turning point this week, it is worthwhile to examine the smaller-scale data. For the first time until April 22, 2022, the DXY is beneath 100, and many analysts are predicting a sharp decline towards 90. Due to the negative connection, risk assets like Bitcoin and cryptocurrencies have traditionally been particularly beneficial if the DXY keeps falling and reaches new lows.
Following this month, Pesole said, the Fed might not be prepared to call it quits on raising rates. The labour market is still extremely tight, and other indicators of the economy are also strong, he noted, even though core inflation has decreased. After surging back over 100.00, the DXY dollar index “may find some support,” continued Pesole.
This Week’s Critical Macro Data
The official US retail sales figures for June, which will be released by the US Census Bureau on Tuesday, July 18 (8:30 am EST), are an important piece of information to keep an eye on. A key measure for determining how private families feel about their consumption is retail sales. Analysts anticipate a +0.4% gain month over month for June, reflecting stabilisation in retail sales. If predictions are met or surpassed, it signals a strengthening of consumer confidence, which might accelerate the DXY’s reversal.
The initial estimates of the US construction permit for June will also be made public on that day. The strength of the US real estate sector is largely determined by the number of building permits issued. Analysts expect the number of permits issued to drop slightly from 1.496 million in May to 1.495 million in June. The DXY may experience more losses if the projected losses are realized or exceeded.
The Philadelphia Fed’s most recent manufacturing index, which is seen as an early indicator for the significant ISM purchasing managers’ index, will be released on Thursday, July 20. Analysts anticipate an improvement from July’s -9.7 to the prior month’s -13.7. The financial outlook for US industrial enterprises would stabilize if projections were met or surpassed.
The US equities market’s reaction would likely be positive, and there would be less of a chance that a recession was about to start. Surprisingly, the start of earnings season is also marked by reports from major financial institutions as well as major tech companies like Tesla, Netflix, and TSM. The senior economist and strategist of Market Securities, Christophe Barraud, predicted that the S&P 500 will experience a fall in earnings for the third consecutive quarter.
Spot Bids For Bitcoin And Crypto
The conduct of investor markets should be this week’s second point of emphasis. The Bitcoin market currently appears to be “pretty short” again, especially on Binance, according to famous analyst Skew (@52Skew), who made this observation today through Twitter. Skew predicts profit-taking on price increases because the exchange’s spot supply is accumulating above price.
The current trading range is between $29,800 and $31,500, with a large number of spot bids hovering between $30,000 and $29,500 at the same time. However, after over a month of consolidation, the founders of Glassnode were upbeat in their most recent study, expressing confidence that the price of Bitcoin is going to surge out of this range. The analysts write that “Bitcoin’s bullish trend remains in play, encouraging the possibility of difficult bottom levels to $28.7 and $29.5k,” but they also caution that “the spot CVD requires to hold the upward trend to break higher than the supply wall set at $32k, indicating that this breakdown above brings in fresh entrants willing to bid (buy, market orders) and propel the price higher.” At the time of publication, Bitcoin was trading at $30,274, remaining unchanged.
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