(BTC) Bitcoin News TodayCryptocurrencyEthereum (ETH)Ripple (XRP)

Bitcoin Crashes Below $60K: Market Reacts to CPI Shock – What’s Next?

Key Insights:

  • Bitcoin plummets under $60K after CPI data falls short, raising concerns of further declines if key support levels break.
  • Ethereum struggles near $2,700, with cautious traders eyeing a potential breakout or drop to crucial support zones.
  • Ripple’s bullish momentum fades as trading volume declines, leaving XRP vulnerable to correction despite a positive technical setup.

Bitcoin (BTC) fell to $59,246.73, losing its previous support above $61,000 following the release of the latest Consumer Price Index (CPI) data, which indicated a 2.9% increase for July, slightly below the expected 3%. 

This drop reflects the market’s reaction to the CPI report as investors await further guidance from the Federal Reserve on potential interest rate adjustments. The decline below $60,000 suggests increased caution among traders, who will closely watch for additional movements that could signal further downward pressure or a potential recovery.

Bitcoin had recently faced resistance near the $62,000 level after losing momentum late last week. However, the support at $58,000 proved resilient, allowing Bitcoin to regain strength and test the $62,000 barrier again. The 200-day Exponential Moving Average (EMA) is a critical resistance point, suggesting that a break above this level could lead to further bullish momentum.

Traders are cautiously optimistic but remain aware of potential volatility, particularly given the significance of the CPI report. A move below $58,000 could trigger a sell-off, with possible declines to $54,000 or even $50,000 if bearish momentum gains traction.

Ethereum Recovers Following Market Pressure

Ethereum (ETH) showed signs of recovery, with its price rising above $2,700 despite recent bearish sentiment driven by a significant sell-off from Jump Trading. The support at $2,600 has proven crucial, helping ETH resist further declines and fueling hopes of a move toward $3,000.

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Market participants closely monitor Ethereum’s price action around the $2,700 mark. Sustained growth above this level could encourage more buying, potentially leading to a breakout above $3,000. On the other hand, if Ethereum falls below $2,700, traders may choose to exit long positions, which could push the price back toward support levels at $2,600 or even $2,500.

The overall market sentiment around Ethereum remains cautious, with investors watching for any signs indicating the next directional move. A further decline could see Ethereum testing lower support levels, while a successful defence of the current range may provide the foundation for a renewed upward push.

Ripple Faces Key Technical Levels Amid Market Activity

Ripple (XRP) is trading at around $0.5788 after successfully breaking out of a bull flag pattern, which signals a potential move towards $0.69. However, the momentum appears to be waning, as indicated by a decline in trading volume. XRP’s ability to hold above its 20-day and 50-day EMAs remains crucial for sustaining the current bullish outlook.

The Moving Average Convergence Divergence (MACD) indicator is flashing a buy signal, which could help propel Ripple’s price toward $0.69 and possibly higher. A breakout above $0.70 might lead to a price target of $1, provided that the bulls maintain their momentum.

Despite the recent breakout, the drop in trading volume suggests that further gains may not come easily. Ripple’s trading volume has decreased by 6%, according to CoinMarketCap, standing at approximately $1.2 billion. This decline in volume could hinder the bulls’ efforts to push the price higher, leaving Ripple vulnerable to a correction back to $0.54 or $0.50 if the current support levels fail.

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Market Outlook Amid CPI and Interest Rate Expectations

The crypto market’s immediate future remains closely tied to broader economic indicators, with the recent CPI data playing a pivotal role in shaping investor expectations. Bitcoin’s ability to hold key support levels will be crucial as traders anticipate further signals from the Federal Reserve regarding interest rate changes.

Given the CPI data, a potential 25 basis point rate cut in September seems increasingly likely, which could provide a favourable environment for cryptocurrencies. However, the market remains on edge, with the possibility of volatility as traders navigate these economic developments.

As for Ethereum and Ripple’s respective support and resistance levels will be critical in determining their near-term price trajectories. Market participants are advised to stay vigilant and monitor these key levels closely, as any significant moves could set the tone for the coming weeks.


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Curtis Dye

Curtis is a cryptocurrency news and analytics author with a focus on DeFi, BLockchain, CeFi, NFTs etc. He has publication skills such as SEO optimization, Wordpress, Surfer tools and aids his viewers with insights on the volatile crypto industry.

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