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Bitcoin (BTC), Ethereum (ETH) Upbeat Despite FTX Saga as PPI Falls

Bitcoin (BTC), Ethereum (ETH) Upbeat Despite FTX Saga as PPI Falls

Tammy Da Costa, Analyst

Bitcoin, Ethereum Latest:

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Bitcoin and Ethereum Turn Positive as PPI Data Boosts Risk Assets

The recent PPI inflation report (producer price index) has followed last week’s CPI print, coming in at 0.2%, below the 0.4% forecast. Essentially, this means that the cost of producing products is less than initially expected.

As equity futures react with enthusiasm, Bitcoin and Ethereum have edged higher, temporarily muting the bearish decline.

Following the collapse of FTX and the Chapter 11 bankruptcy filing of over 100 companies, uncertainty and fear have resulted in a broader market sell-off. With Sam Bankman-Fried responsible for a $200 Billion reduction in the total crypto market cap over last week, the longer-term implications of recent events remain unknown.

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With investor confidence dwindling, Binance CEO, ‘CZ’ Zhao announced his intention to start a crypto recovery fund for firms affected by FXT, providing some hope for major cryptocurrency.

After Bitcoin broke through major Fibonacci support at $19225.4 (the 23.6% Fib of the ’20 – ’21 move), BTC/USD continued to slide, dropping below $16000. Although price action remains above the descending trendline from the November 2021 high, selling pressure has temporarily eased. As BTC attempts to recover from the recent decline, the current monthly low remains as support at $15632.

Bitcoin (BTC) Weekly Chart

Chart  Description automatically generated

Chart prepared by Tammy Da Costa using TradingView

Looking at price action on the daily chart reveals additional levels that could contribute to the short-term move. At the time of writing, BTC/USD is trading around 2.56% higher on the day, rising above the key psychological level of $17000. For Bitcoin bulls to drive the recovery, a move above the June low at $17592.78 may allow for further gains.

At the same time, fundamental risks remain at the forefront of risk sentiment making digital assets vulnerable to further developments in the Sam Bankman-Fried case. As prices remain below the 50-day MA (moving average) providing the next zone of major resistance at $19340.

If the downward trajectory gains traction, a retest of $16000 and $15632 could potentially allow prices to continue to move towards $14000.

Bitcoin (BTC/USD) Daily Chart

Chart, histogram  Description automatically generated

Chart prepared by Tammy Da Costa using TradingView

However, Ethereum has managed to rise back above $1200, remaining relatively stable compared to its alt-coin counterparts. With prices heading back towards $1300, resistance remains at prior support at around $1280.

Ethereum (ETH/USD) Daily Chart

Chart, histogram  Description automatically generated

Chart prepared by Tammy Da Costa using TradingView

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--- Written by Tammy Da Costa, Analyst for DailyFX.com

Contact and follow Tammy on Twitter: @Tams707

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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