(Kitco News) - The cryptocurrency market saw a bounce-back in prices during trading on Thursday as yesterday’s market rout resulted in fire sale prices that many investors just couldn’t resist.
A lower-than-expected Consumer Price Index (CPI) print, which came in at 7.7% rather than the anticipated 7.9%, provided a boost to all markets as many anticipate that the Fed can now start to slow down the pace of interest rate hikes as inflation begins to moderate.
Financial markets were off to the races following the CPI release and remained elevated throughout the day. At the market close, the S&P, Dow and Nasdaq all finished well in the green, up 5.36%, 3.53% and 7.25%, respectively.
Data from TradingView shows that Bitcoin (BTC) bulls managed to ride the CPI wave higher, with BTC spiking 14.82% from a low of $15,856 to an intraday high of $18,215 in the late afternoon. At the time of writing, bulls and bears are battling it out for control of the $17,850 support/resistance level.
BTC/USD 4-hour chart. Source: TradingView
Despite the double-digit recovery, BTC is not out of the woods yet as bears continue to experience a “near-term technical advantage to suggest still more downside price pressure in the near term,” according to Kitco senior technical analyst Jim Wyckoff.
This sentiment was echoed by pseudonymous crypto charter Moustache, who posted the following tweet warning that the bounce so far looks like a bearish retest of the June lows.
#Bitcoin $BTC
— ????????????????? ?? (@el_crypto_prof) November 10, 2022
Be Careful: So far it's only a bearish retest from the June lows.
Keep it simple:
Reclaim the Line = Bullish
Below the line = Bearish pic.twitter.com/MvoooT0mTS
Based on the chart, Bitcoin would need to hold above $17,600 for an extended period before invalidating the bearish perspective.
Crypto analyst il Capo of Crypto, who has for months been warning about a potential pullback as low as $14,000, offered the following words of advice for traders going all in following this spike.
Rule #1: never buy the first bounce
— il Capo Of Crypto (@CryptoCapo_) May 10, 2022
Altcoins rocket higher
The market turnaround saw altcoin prices surge higher, with nearly all tokens in the top 200 posting gains on the day aside from the stablecoins.
Ether (ETH) saw its price bounce back from a two-year low to gain 15.32% on the day and reclaim the $1,300 support level, while the layer-two scaling solution Polygon (MATIC) erased all recent losses with a 36% spike in price to trade at $1.13.
Daily cryptocurrency market performance. Source: Coin360
The top gainers on the day include a 59.27% increase for Band Protocol (BAND), a 43.38% gain for Render Token (RNDR), and a 37.56% increase for Solana (SOL).
The overall cryptocurrency market cap now stands at $897 billion, and Bitcoin’s dominance rate is 38.4%.
