Bitcoin
Altcoins Redeemed as BTC Acts on CPI Data
- Bitcoin price could achieve a shift in market structure towards further upside if BTC holds steady above $65,500.
- Ethereum defends $2,900, but the 26% upside potential will only be activated after it surpasses $3,212.
- Ripple price RSI must register a stable high above the average level of 50 for XRP to become attractive.
Bitcoin (BTC) price rescued altcoins on Wednesday following US inflation data, which was measured by determining the change in the Consumer Price Index (CPI). Like the core CPI, the CPI was cooler than in previous months, at 3.4%.
❖ US CPI (MOM) (APR) REAL: 0.3% VS PREVIOUS 0.4%; EST 0.4%
❖ US CPI (YOY) (APR) REAL: 3.4% VS PREVIOUS 3.5%; EST 3.4%
❖ US CORE CPI (MOM) (APR) REAL: 0.3% VS PREVIOUS 0.4%; EST 0.3%
❖ US CORE CPI (YOY) (APR) REAL: 3.6% VS PREVIOUS 3.8%; EST 3.6%
– *Walter Bloomberg (@DeItaone) May 15, 2024
Markets like this so far with yields falling just like the US dollar (USD). Cryptocurrency assets rose, meaning the data release was a much-needed catalyst.
Read too: Bitcoin price restores early May highs as US CPI surprises to the downside
Bitcoin price is a fraction away from changing market structure
Bitcoin price is trading in an uptrend, sliding along an ascending trendline with higher highs. After a streak of lower highs, BTC could change the market structure if it manages a stable close above the $65,500 resistance level.
This is likely as long as BTC holders keep their profit appetite in check and buyer momentum increases. The higher lows of the Relative Strength Index (RSI) show an increasing bullish trend. Traders looking to enter long positions for BTC may consider waiting for a higher RSI reading.
A stable close above $65,500 in the one-day period would encourage more buy orders, with the resulting buying pressure sending Bitcoin’s price towards $70,000. Beyond this level, BTC would have a chance to reclaim the $73,777 peak. Notably, the DXY Compare indicator is also falling, which has often exhibited a countercurrent flow towards BTC price.
BTC/USDT 1-Day Chart
On the other hand, if traders book profits for Wednesday’s divine candle, the price of Bitcoin could fall. A drop below $63,354 would scare panic sellers, as happened on two recent occasions, May 9th and May 13th, where BTC was rejected at the above-mentioned level.
In a dire case, Bitcoin price could fall below the ascending trendline and ultimately fall below the $60,630 support level. Below this level, BTC could roll towards $58,000, or worse, $56,552, levels last tested on May 1.
Read too: Will the resurgence of GameStop shares have a downstream effect on BTC and alts?
The $3,212 level is critical for Ethereum price upside potential
Ethereum price is trying to regain ground above the ascending trendline after a drop below on Tuesday. The government graphic The pattern is a falling wedge, which is a bullish reversal technical formation. For the 26% target to be achieved, however, ETH must manage a candlestick close above $3,212.
ETH/USDT 1-Day Chart
On the other hand, the increase in salespeople’s dynamism could lead to Ethereum Price to tear down. If the decline extends to close below $2,781, it will invalidate the bullish thesis.
Notably, the RSI continues to oscillate sideways with equal lows as it remains moderately below the average level of 50. This shows that the bears still have the upper hand.
XRP bulls sitting on their hands
Ripple price remains range-bound as XRP bulls continue to stay put. This is seen with the RSI stuck below the average level of 50 since April 11th. If the RSI records a higher high within the upper segment of the range, Ripple price could extend the rally.
Meanwhile, Ripple price will likely consolidate around 50% Fibonacci placeholder at $0.4952, with the horizontal cut likely to continue.
XRP/USDT 1-Day Chart
On the other hand, higher profit booking could cause Ripple price to destroy the covered ground, falling below $0.4952. In a dire case, XRP price could extend the decline to $0.4500, or worse, extend a leg to $0.4188, levels last tested on April 13.
Read too: XRP Maintains Gains as Lawyers Debate Relevance of Discounts Offered to Ripple Institutional Clients
Frequently Asked Questions about Bitcoin, altcoins and stablecoins
Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any person, group or entity, which eliminates the need for third parties to participate in financial transactions.
Altcoins are any cryptocurrency other than Bitcoin, but some also consider Ethereum to be a non-altcoin because it is from these two cryptocurrencies that the fork occurs. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and therefore an “improved” version of it.
Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by a reserve of the asset they represent. To achieve this, the value of any stablecoin is tied to a commodity or financial instrument, such as the US dollar (USD), with its supply or demand regulated by an algorithm. The main purpose of stablecoins is to provide an on/off ramp for investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value, as cryptocurrencies, in general, are subject to volatility.
Bitcoin dominance is the ratio of Bitcoin’s market capitalization to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin’s interest among investors. High BTC dominance typically happens before and during a bull run, in which investors resort to investing in relatively stable, high market cap cryptocurrencies like Bitcoin. A drop in BTC dominance usually means that investors are moving their capital and/or profits into altcoins in search of higher returns, which usually triggers an altcoin rally.