Bitcoin (BTC) pierced the top of a stubborn trading range on Aug. 11 as a decidedly uneasy rally gripped risk assets.
Bitcoin Pullback Warnings Intensify Near $25,000
Data from Cointelegraph Markets Pro and TradingView showed that the BTC/USD pair hit highs of $24,750 on Bitstamp, marking its best performance since June 13.
The pair had attempted several breakouts towards the top of the range in the previous weeksbut all of them failed under strong sales pressure.
Nevertheless, New US inflation data released this week has been a catalyst for the long-awaited turnaround: bitcoin and altcoins have risen in tandem with equities, and July’s consumer price index (CPI) suggests that inflation has peaked.
On August 10, the day of publication, the S&P 500 and the Nasdaq Composite Index gained 2.1% and 1.9% respectively. The BTC/USD pair, meanwhile, posted a daily candle around $900.
Nevertheless, Instead of piling on optimism, market commentators were anything but bullish as the dust settled. Investor Raoul Pal noted that sentiment was wary of the post-CPI rise.
Nevertheless, Pal said there was a “very decent chance” that equities had seen their lows in June.
Forecasting a major turnaround in the crypto space, popular trader and analyst Il Capo of Crypto defined the $25,500 mark as the likely maximum target before a new downtrend begins.
Almost there. https://t.co/oJFpD5BVz9 pic.twitter.com/2pjpUgw85T
— il Capo Of Crypto (@CryptoCapo_) August 11, 2022
We are almost there.
“BTC pumped nearly 40%. There is a huge chance of a pullback. Buy the dip,” continuous Jibon in other Twitter comments.
For its part, Crypto Tony, a little more hopeful, said that users would be “in luck” if the top of the range managed to hold.
Noting possible similarities between bitcoin’s chart now and March 2020, BTCfuel added that a further breakout was not out of the cards.
— BTCfuel (@BTCfuel) August 10, 2022
The bull trap and bitcoin crash in March 2020 are quite similar to the current setup. Bitcoin seems to be reaching a turning point.
Doubts arise about the Ethereum rally
The impressive performance of altcoins put the biggest altcoin, Ether (ETH) in the spotlight after the ETH/USD pair saw gains of more than 11%.
The pair continued its gains on the day, breaking above $1,900 for the first time since June 6. and now approaching the psychologically significant $2,000 mark.
The IPC momentum added to an already excited Ethereum market, as the Goerli testnet merger -a key preparatory step for the full merger event in September- concluded successfully.
“Since the start of this bear market rally, in mid-June, Ethereum is gaining dominance in terms of trading volume relative to bitcoin. In recent days, the dominance of Ethereum and bitcoin has even crossed,” Maartuun wrote.a contributing analyst at on-chain data platform CryptoQuant, in a blog post on Aug. 10.
Maartuun warned that historical precedent does not favor a sustained rally in cryptocurrencies if led by ETH.
“It is clear that Ethereum is very popular on exchanges, due to the dominance gain. That makes sense due to the upcoming Fusion 2.0 rollout,” he added.. “However, from my 5-year experience in the cryptocurrency market, Ethereum-led rallies are often not the healthiest thing for the market. As you could already read in my previous analysis, I am very conservative. Especially since Ethereum has already made a >100% move from its lows.”
“However, from my 5-year experience in the crypto market, rallies that are led by Ethereum are usually not the healthiest thing for the market. As you could read in my previous analysis, I am very conservative. Especially since Ethereum already made a movement > 100% from the lows.”
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