Crypto markets edged higher on Thursday, as markets reacted to cooling US inflation, improving risk sentiment.
The bitcoin price rose on Thursday, touching $21,000. If the BTC price declines, support can be found near $17,930, while resistance may be encountered at $22,700.
Ethereum price also rose on Thursday, climbing to $1,560. If Ethereum's price declines, it may encounter support near $1,370, while if it increases, resistance may be encountered near $1,670.
US PPI data on Wednesday fell below expectations, reducing Fed rate hike expectations. PPI declined by 0.5% in December, versus estimates of a 0.1% drop. However, a soft inflation print was expected and had largely been priced in by markets. Headline inflation also dropped to 6.5% year-on-year in December from 7.1% in November. US inflation seems to be cooling, which may give the Federal Reserve some leeway toward scaling back its interest rate increases.
Even though inflation rates remain high, cooling price pressures have reduced rate hike expectations, providing support for riskier assets. The Fed and other central banks are starting to scale back their aggressive rate hiking, raising hopes of a reversal in cryptocurrencies’ downfall.
BTC/USD 1h Chart
ETH/USD 1h Chart
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