Bitcoin (BTC) rose on August 18, as recent data confirmed the highest inflation in the history of the European Union.
Support and Resistance Levels Approach BTC Spot Price
Data from Cointelegraph Markets Pro and TradingView showed that the BTC/USD pair had broken above $23,500 at press time, having held $23,000 as support overnight.
Concerns about further declines in risk assets have been widespread throughout the week, with Bitcoin and Ether (ETH) especially unable to break above long-term resistance levels.
With the bulls seemingly off the mark, analysts naturally advise caution.
“BTC did break out of this huge bullish channel/edge that everyone seems to be seeing,” Daan Crypto Trades wrote in part of their latest update on twitter.
“$23,800-$24,000 will act as resistance. Another break lower and this would be a big bear trap. Bearish rejection and we go lower.”
Short-term support, meanwhile, came in the form of whale buying starting at $22,800, according to on-chain monitoring resource Whalemap.
Now just below Bitcoin’s 200-week moving average, the $22,800 zone should be the line in the sand to watch in the event of a market downturn.
“We return to the starting point”, summarized the Whalemap team next to a chart showing the spread of coins held by whales by price point.
“Whales accumulations at $23,400-$22,800 is still the closest support we have for Bitcoin (if we start falling).”
Inflation breaks records
Macroeconomic factors were clearly influenced by inflation during the day, with the EU July figure of 9.8% leading the way.
The data for July marked the highest inflation figure in the history of the eurozone, compared to 9.6% year-on-year in June. In July 2021, inflation was 2.5%.
“The lowest annual rates were registered in France, Malta (both with 6.8%) and Finland (8.0%). The highest annual rates were registered in Estonia (23.2%), Latvia (21.3%) and Lithuania (20.9%), “says a Eurostat report.
“Compared to June, annual inflation fell in six Member States, remained stable in three and rose in eighteen.”
In an interview with Reuters on August 18, Isabel Schnabel, a member of the Executive Committee of the European Central Bank (ECB), could not say for sure that inflation had reached a ceiling.
“I wouldn’t rule out that, in the short term, inflation will continue to rise,” he said.
“But any projection is currently subject to a lot of uncertainty. So it’s very difficult to predict when inflation is going to peak.”
The EU figures came a day after the UK recorded the first double-digit inflation figures since the early 1980s.
This month, the price increase in the United States seems to be slowing down, and the next inflation reading is scheduled for September 13.
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