A marginal 0.1% US inflation growth in March 2023 has troubled the crypto markets. After a harsh recession, markets are trying to recoup losses due to the liquidity crunch caused by high inflation and subsequent interest rate hikes. In the last 24 hours, several major altcoins report more than a 3% fall in prices in anticipation of higher interest rate hikes.
However, Bitcoin remains mostly untouched by interest rates. The reason is the ongoing rally of Bitcoin which gained more than 47% in the last 30 days.
The US inflation data for the period of March 2023 was released today, April 12. The data shows that though the net price rise was just 0.1%, inflation was much higher in some core areas. The year-on-year food inflation was recorded at 8.5%.
The impact of these inflation data was felt on several altcoins, including BNB, XRP, DOGE, and LTC, which lost as much as 3% in the last 24 hours. However, unlike altcoins, Bitcoin remains untouched, with just a 0.6% price fall. Ethereum gained 0.35% in the last 24 hours because of a rise in futures open interest.
Bitcoin is strong on its path toward a new yearly high after spending much of 2022 in a recession phase. The cryptocurrency has attempted to close $30k multiple times in the past couple of days. If the price sustains above $32k, it could lead Bitcoin prices toward $48k or above. Let us analyze with technical charts.
The chart setup looks very interesting for Bitcoin. The chart shows that Bitcoin has a very strong resistance at $32k, which will act as strong support once the coin passes this level. Further, the technical indicators show that:
Further, as per CME Group data, Bitcoin futures contracts are at their highest volume in April, showing markets are positively reacting with greater participation.
Overall the trade setup looks attractive, and here are the targets and stop loss levels.
Targets: $40,000, $47600
Stop loss: $28045
Time: 6 months – 1 year
XRP, one of the most tracked altcoins, is facing price resistance due to the ongoing legal dispute between SEC and Ripple Labs. SEC recently gained the upper hand by quoting an earlier case which concluded on April 7, 2023, similar to the current case. However, the case is expected to conclude soon, with both sides filing for summary judgment. If XRP wins the case, it will propel the cryptocurrency towards much higher prices.
Currently, the outlook is a little negative, and traders are advised to exercise precautions.
Technical indicators show that:
It is best to avoid trading in this altcoin for a while. We suggest avoiding shorting it either because of the volatile impact of the legal aspects on XRP prices.
However, once the case finishes, you can hold some XRP for hopeful gains. If XRP wins the case, prices can rally toward $0.86.
Dogecoin, a favorite altcoin of web3 enthusiasts, has been in the news after Elon posted a meme suggesting Dogecoin could be an official or favored cryptocurrency of Twitter. However, the prices have fallen as users realize it is long before anything like that happens. Currently, the cryptocurrency is battered down 2.5% after the inflation data came. This price fall is part of a broader market correction in cryptocurrencies.
The price trend is intact on technical charts, and the coin might cross $0.1 again by May 2023.
The technical indicators signal a weak near-term future for Dogecoin.
Short traders can avail of this opportunity to short the cryptocurrency at current levels.
Target: $0.069
Stop Loss: $0.089
However, in the period of 1-2 months, the price is expected to rise. Traders should avoid shorting it in the medium term.