Bitcoin returns to $42K as markets await potential 7.9% CPI inflation data
The run-up to the latest snapshot of just how bad U.S. inflation is seeing Bitcoin breakthrough range low resistance.
Bitcoin (BTC) hit $42,000 on March 9 as an impressive overnight candle saw bulls reclaim support levels.
Trader: Market “still fragile”
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD abruptly “squeeze” through previous resistance at $39,600, going on to deliver 24-hour gains of 11.3%.
Amid local highs of $42,438 on Bitstamp, the mood among traders was also improving, but caution remained.
Multiple macro factors: The Russia-Ukraine war, inflation and the United States‘ incoming executive order on cryptocurrency all kept commentators wary.
“I can’t deny that the market is looking a bit better after this move. However, still very fragile, short timeframe and uncertain,” Cointelegraph contributor Michaël van de Poppe said as part of Twitter comments on the day.
Fellow trader and analyst Pentoshi was similarly cool on the performance, which took Bitcoin back to the upper segment of a range where it had lingered throughout 2022.
IF 40.7k holds on the 1D/3D THEN will look once again for the yearly open for a third time prev was from near blue “value area”. First two both came up just short. Third time likely the charm IF 40.7k holds
Below 40.7k = no bueno
Targets:
Hold 46.2k
and 52-53k https://t.co/zMkoiCZcjV pic.twitter.com/tSigWopXn3— Pentoshi (@Pentosh1) March 9, 2022
“This was a nice squeeze, but ultimately want to see Bitcoin reclaim 46-47k to feel confident that momentum has been regained,” William Clemente, lead insights analyst at mining firm Blockware, added.
Bets remained open as to the impact of Thursday‘s consumer price index (CPI) data for February. This is expected to be 7.9% and a key driver of short-term volatility for BTC/USD.
The data would precede the following week‘s decision on key interest rates from the Federal Reserve, with expectations just as varied as to its scope.
“IMO BTC‘s first dip from 60k to 30k in 2021 was caused by China‘s mining ban. The second dip from 60k to 30k in 2021 was caused by inflation combined with possible rate hikes & QE ending,” PlanB, creator of the stock-to-flow family of Bitcoin price models, argued.
LUNA returns to top major altcoin returns
Bitcoin thus performed strongly even against many altcoins, with the top ten cryptocurrencies by market cap struggling to keep up.
Related: Bitcoin stems losses after US bans Russian oil, gold heads to record highs
Ether (ETH) was up 7.2% on the day at the time of writing, while others were flatter such as Ripple (XRP) on 3.7%.
The briskest gains belonged to Terra (LUNA) once again with LUNA/USD targeting 20% gains and its highest since mid-January.
