Crypto Market Reacts to CPI Report
The CPI report had little impact on the crypto market as Bitcoin (BTC) continued to trade sideways below $29,800. Most altcoins in the top 200 also traded within 3% of Wednesday’s prices. Stocks initially responded positively to the report, indicating that the Federal Reserve’s fight against inflation is headed in the right direction.
Bitcoin Continues to Consolidate
Bitcoin’s price remained compressed, trading between $29,305 and $29,715 on Thursday. Analysts are warning that a breakout is imminent, but the direction of the next move is yet to be determined. Bitcoin futures prices were weaker, following losses on Wednesday and gains on Tuesday. The market remains in a sideways and choppy grind, with neither bulls nor bears gaining much traction. The next trending price move will depend on whether prices break out above the resistance line or below the support line.
Upcoming SEC Developments
The upcoming SEC developments could serve as a catalyst for the next move in the market. Deadlines to respond to the ARK-21Shares Bitcoin ETF re-filing and Grayscale’s GBTC lawsuit filing are approaching. In September, seven other Bitcoin ETF filings are required to receive a response from the SEC. If approved, the ETF providers would spend considerable marketing expenses to attract retail and institutional capital, leading to a potential increase in Bitcoin prices. Investors should be prepared for potential positive impact on days when the SEC is scheduled to respond to the ETF applications.
Potential Short-Term Price Correction
The SEC has the option to extend the deadline for ruling on ARK’s BTC ETF application. The practicability of surveillance-sharing agreements with Coinbase will be considered, which could result in a short-term price correction. It is anticipated that such a correction could present a buying opportunity for Bitcoin, with prices potentially declining to $26,000/$27,000 as the summer lull ends. Matrixport has a macro price target for Bitcoin, with projections of $45,000 by December 2023, $63,160 by March 2024, and $125,731 by December 2024.
Altcoin Market Performance
The altcoin market had a mixed day, with a few tokens recording double-digit gains. Akash Network (AKT) saw a significant increase of 31%, while XDC Network (XDC) gained 10.5%. On the other hand, Worldcoin (WLD) experienced the biggest decline of 8.46%, followed by UniBot (UNIBOT) with a 6.72% decrease and XRP with a 4.25% decline. The overall cryptocurrency market cap currently stands at $1.17 trillion, with Bitcoin’s dominance rate at 48.7%.