Bitcoin treads water for $30k as altcoins take a hit
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(Kitco News) – The cryptocurrency market saw a slight decline in prices on Wednesday as the latest Consumer Price Index (CPI) data came in lower than expected, with monthly inflation rising 0.1% while the CPI was up 5% year-on-year. .
US stocks initially saw a boost in prices after the latest inflation numbers, but the momentum soon waned as investors realized that core inflation remains well above the Fed’s 2% target, meaning further rate hikes may still be needed. At market close, the S&P, Dow and Nasdaq were all in the red, down 0.41%, 0.11% and 0.85% respectively.
Data provided by TradingView shows that the CPI data also led to a volatile trading day for Bitcoin (BTC), with the price rising to a high of $30,706 near midday, only to crash to a low of $29,840 several hours later before eventually climbed back above support at $30,000.
BTC/USD 4-hour chart. Source: TradingView
The early-morning decline in BTC caused April bitcoin futures prices to trade “a bit weaker,” according to Kitco senior technical analyst Jim Wyckoff, who attributed the pullback to “routine profit after hitting a contract high Tuesday.”
“The market this week has seen a bullish upside breakout from the sideways trading range at higher levels to restart an uptrend,” Wyckoff said. “BC bulls have the solid overall technical advantage in the near term and have the power to suggest even more upside in the near term.”
Ahead of the CPI release, Eight Global analysts noted that “Bitcoin remains relatively strong, but altcoins are bleeding heavily.” A good visual representation of this fact can be found on the Bitcoin Dominance chart, which has been rising since November and just reached its highest level since May 2022.
Bitcoin Dominance 3-Day Chart. Source: Eight Global
“We see that the chart is in a high time frame and it is trying to break out of this area,” Eight Global wrote. “If we are able to get a bullish continuation when we have a retest of the area high, we could see a continuation in the strength of BTC. If we deviate above the area high and creep back into the area, altcoins could gain some momentum and opportunities to shine.”
Scott Melker, host of The Wolf of All Streets podcast, believes the latter is more likely to come true, with altcoins trending higher and Bitcoin’s dominance falling “unless we see a HUGE breakout and Bitcoin crushes everything.”
$BTC Dominance
Now a clear case must be made for altcoins to surpass.
Although charting a non-trading asset is a meme, it does provide clues. Dominance has been in this area for years – when the RSI hits overbought and it hits the top, the dominance declines and the altar is surpassed. The… pic.twitter.com/bsDeIajszI
— The Wolf Of All Streets (@scottmelker) 12 April 2023
Switching to BTC price analysis, Eight Global noted that the 4-hour chart “shows us a pretty clear view of what the next [move] should be, with the information we have right now.”
BTC/USD 4-hour chart. Source: TradingView
“We had a wave of the high and we see some weakness on the lower time frame, but the higher time frame shows us that we have nothing to worry about now,” they said. “Actually, a correction would be healthy for the overall price action. The main area where you can get interested in longs is the green shaded area at $28.4-28.8K.”
Altcoins are entering correction territory
The broader altcoin market retreated into correction territory on Wednesday as profit-taking and waning momentum led to small declines for the majority of tokens in the top 200.
Daily performance in the cryptocurrency market. Source: Coin360
Multichain (MULTI) was the one double-digit gainer for the day, rising 10.1% to trade at $10.85, while Helium (HNT) price rose 7.21% and Terra (LUNA) rose 6.64% .
The total cryptocurrency market cap is now $1.23 trillion, and Bitcoin’s dominance rate is 47.2%.
Disclaimer: The views expressed in this article are those of the author and may not reflect the views of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is for informational purposes only. It is not an invitation to exchange goods, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept responsibility for any loss and/or damage arising from the use of this publication.
