The cryptocurrency market has been experiencing a positive trend over the last few days, buoyed by factors such as a favorable US jobs report and renewed trade talks between the US and China. This upward trajectory has helped recover from the flash crash that occurred on Thursday.
Despite the current optimism, experts are warning that major cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), and Ripple’s XRP are facing significant risks this week. The outcome of the US-China trade talks scheduled for Monday in London is expected to be a volatile catalyst that could lead to sharp price movements.
Another important factor to watch this week is Wednesday’s CPI data, which is crucial for market sentiment. A Bloomberg survey suggests that inflation may have spiked in May due to tariffs. If the CPI report shows a higher-than-expected number, it could trigger a bearish move in the crypto market by indicating a slowdown in consumer spending. On the other hand, a lower-than-expected CPI could lead to significant gains for top cryptocurrencies and altcoins.
The Bitcoin price is currently at $107663 and is on a path to recovery after finding support from the 50-day EMA band. It has broken a short-term declining trendline and is aiming for the $112K mark. If the momentum continues and the upcoming US CPI reports are favorable, an all-time high (ATH) could be within reach. However, there are concerns that inflation may be picking up, which could lead to a short-lived momentum and a potential drop in price.
On-chain data has revealed a concerning trend where small wallets holding up to 1 BTC have been accumulating strongly. This retail FOMO could be a warning sign that a sell-off may be imminent as whales prepare to capitalize on the liquidity provided by small investors.
In the last three days, the rise in Bitcoin prices has also boosted the prices of altcoins like XRP and Ethereum by 8% and 6% respectively. However, these gains may not be enough to break through key resistance levels. The performance of XRP and ETH this week will largely depend on the CPI data. If the CPI comes in higher than expected, a drop in altcoin prices is likely. Conversely, a soft CPI report could provide a short-term catalyst for clearing hurdles.
If XRP manages to rise, the target for this week is $2.65, while Ethereum is aiming for $3066. On the downside, XRP could fall to $1.80, and ETH towards $2000. It’s important to stay informed with the latest news and analysis in the cryptocurrency world to make informed decisions.