(Kitco News) – It was an overall positive day for global financial markets as asset prices trended higher ahead of tomorrow’s Consumer Price Index, which many anticipate will show that inflation continues to ease after hitting multi-decade highs in 2022.
The S&P, Dow and Nasdaq benefited from the positive mood of traders on Wall Street as all three indices finished the day well into the green, up 1.28%, 0.80% and 1.76%, respectively.
Data from TradingView shows that after holding near support at $17,450 throughout the morning session on Wednesday, Bitcoin’s (BTC) price underwent a quick dump and pump in the afternoon that saw it briefly dip to $17,320 before springing back to $17,565.
BTC/USD 4-hour chart. Source: TradingView
According to Kitco senior technical analyst Jim Wyckoff, “Bulls have gained some upside technical momentum recently and are working on a fledgling price uptrend on the daily bar chart.”
With the BTC price now above key resistance at the 50-day moving average, traders have begun to adopt a more positive outlook while simultaneously acknowledging the possibility of another drop in the market remains a possibility.
This fact was touched on in the most recent market update from analysts at Eight Global, who warned that CPI announcements “normally bring a lot of volatility and getting into a position with a tight stop is very risky.”
“Normally we see a run on liquidity on both sides and this could easily stop you out,” analysts warned. “Looking at the 1-hour chart of Bitcoin we can see that we are consolidating […] From a long position perspective I would say that the area around $16.9-17K is the zone where you want to get in position.
Eight Global co-founder Michaël van de Poppe posted the following tweet showing what the price action might look like around the time that the CPI is announced and suggested that Bitcoin could soon head to $18,500 if the “CPI is beat.”
As stated, #Bitcoin needed to hold the area around $17.3K, which it did.
In that regard, we probably continue rallying and then it depends on CPI.
Most likely, given the current outlook, we correct temporarily around CPI, before we continue.
If CPI is beat, tomorrow $18.5K pic.twitter.com/6tmxU3k07l
— Michaël van de Poppe (@CryptoMichNL) January 11, 2023
A longer-term outlook into where BTC currently stands as 2023 gets underway was provided by market analyst Rekt Capital, who posted the following tweet of the yearly chart for Bitcoin, which suggests that Bitcoin is poised for a breakout at some point over the next 12 to 24 months.
If 2022 was full of pessimism, fear, and doubt…
— Rekt Capital (@rektcapital) January 11, 2023
Mixed day for the altcoin market
The performance of the altcoin market was mixed on Wednesday as a handful of tokens charged higher while the majority traded flat or recorded slight losses.
Daily cryptocurrency market performance. Source: Coin360
The biggest gainer on the day was Avalanche (AVAX), as the announcement of a partnership with Amazon Web Services sparked a 22% intraday rally for the layer-1 protocol. Other notable performances include a 13.15% increase for Voyager Token (VGX) and an 8.72% gain for Illuvium (ILV).
The overall cryptocurrency market cap now stands at $862 billion, and Bitcoin’s dominance rate is 39.2%.
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