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Cryptocurrencies volatile after US inflation spike

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Written by:
Myrsini Giannouli

11 February 2022
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Crypto markets fell on Thursday, following the release of the US inflation data. US Monthly CPI and Core CPI data released on Thursday showed US inflation has reached a 40-year high. Rising inflation rates tend to work in favour of risk assets such as cryptos. The increasing inflation rates however, have fuelled expectations that the Federal Reserve will go ahead with a more aggressive tightening of its fiscal policy, driving the price of cryptos down. This was a common theme with many assets on Thursday, as the release of the US CPI data sent mixed signals to markets.

Bitcoin and Ethereum prices have been rising over the past week, with Bitcoin reaching $45,000 for the first time in weeks. BTC is currently testing the $44,300 level resistance. If its price declines, it may find support at $36,000 and further down at $33,000, while if the price of Bitcoin goes up, it may find resistance near $51,900. 

Ethereum broke through the $3,000 level resistance earlier this week and is currently trading above this level. If its price goes down, it may find support at $2,640 and further support around $2,150. In case its price goes up, it may find resistance around $3,400. 

Cryptos have been under pressure since the beginning of the year, with Bitcoin losing over 20% of its value, hit by a bout of risk-aversion. The bulls have attempted several times to reverse the downtrend, with little success so far. The recent volatility in stock markets, and especially the fall of tech-stocks has been affecting crypto markets, which seem to have developed a strong dependency on stock market trends.

BTC/USD 1h Chart

BTCUSD 1hr chart

 

ETH/USD 1h Chart

ETHUSD 1hr chart

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Written by:
Myrsini Giannouli

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