Bitcoin (BTC) set another multi-month high before the January 18 Wall Street open as United States macroeconomic data fell far short of expectations.
US PPI numbers fall off the mark
Data from Cointelegraph Markets Pro and TradingView show BTC/USD rising to $21,646 on Bitstamp.
A subsequent correction saw the pair moving around $21,400 at the time of writing, with US stocks reacting to surprise data surrounding economic activity in December.
Specifically, the Producer Price Index (PPI) showed a faster-than-expected increase in costs, with retail sales also falling more than expected.
“PPI came in at 6.2%, while expectations were 6.8%. Core PPI came in at 5.5%, while expectations were 5.7%,” Cointelegraph contributor Michaël van de Poppe write as part of our ongoing Twitter updates.
“Retail sales at -1.1%, compared to -0.8% expected. Core retail sales at -1.1%, compared to -0.4% expected. Very disappointing.”
Bitcoin shows bullishness around the numbers, this is potentially signaling less than the need for more aggressive interest rate hikes from the Federal Reserve going forward.
Earlier, Cointelegraph reported that the Bank of Japan itself did not make the privacy too loose more restrictive, in contrast to the Fed and other major central banks.
The already troubled US dollar index (DXY) thus extended the retreat that started with the news from Japan when the PPI hit, falling to 101.52, the lowest since the end of May last year.
Analysis looks at “fading momentum” on the BTC chart
BTC/USD last traded at an intraday high in mid-September.
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As usual, there was a lot of visible nerves among traders despite the strong performance, with analytics source Materials Indicators repeating warnings about the weakness of the uptrend.
“Wing up for the same game on the BTC chart,” it is write on the day, the status quo reference in the Binance order book.
“The shrinking volume makes me think that the momentum is fading, and the fact that some bids have been cleared. Watch to see if bid liquidity continues to fill and move up. If not, the 21-Week Moving Average should hold.
More optimistic is the popular commentator Bloodgood, who contradicts others’ bearish predictions of a drop to $12,000 for BTC/USD in 2023.
Analyzing the longer picture, he said the two-year decline seen in Q4 was a “broken failure.”
“A failed breakout usually leads to a strong reversal,” he added on the accompanying chart with a key support zone around $19,000.
“$12k doesn’t play as long as we stay above the blue line. Get another weekly candle to close above and we’ll be higher.
The picture of long and short positions by Filbfilb, the founder of the Decentrader trading company, is also interesting.
“The liquidity picture looks very different now for BTCUSD. More sweat than cows at this point,” he said tweeted.
The views, thoughts and opinions expressed here are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.