5 min readBitcoin has fallen to 66K, erasing nearly all of its recent gains above 70 K and resuming a slide toward last week’s 60K low. The largest cryptocurrency has fallen 3.5% this week, marking its fourth straight weekly decline.
Other major cryptocurrencies are also under pressure, with Ethereum below 2000 at 1955 and Solana below $80. The total cryptocurrency market cap is down 0.4% across the past 24 hours.
Weakness in crypto has mirrored a broad price decline in the tech-heavy NASDAQ, which fell 2% on Wednesday, and, more specifically, in the software sector, which fell 3% amid questions about valuations and concerns over AI disruption.
Interestingly, even gold and silver were not immune to yesterday’s sell-off, with silver plunging by more than 10% and gold settling 3% lower.
However, price action is settling on Friday, with U.S. futures unchanged, while gold is attempting a rebound towards 5000.
What to expect from US CPI data?
Attention is now turning to US CPI data, which is expected to show that both headline and core inflation cooled in January.
CPI is expected to ease from 2.7% at the end of last year to 2.5% in January, whilst core inflation is expected to ease from 2.6% to 2.5%. Cooler-than-expected CPI supports the story of easing inflation, making the case for Federal Reserve rate cuts. However, if inflation is hotter than it points to ongoing price pressures and could see the market lower rate cut expectations.
Expectations for the next 25 basis point rate reduction had been pushed back to July, following Wednesday’s stronger-than-expected nonfarm payrolls report.
Bitcoin, along with other risk assets, tends to perform well in low-interest-rate environments. Therefore, cooler CPI data could help put a floor under BTC’s selloff, at least in the near term.
Ripple struggles despite Aviva collaboration & ETF demand
Ripple is falling for a third straight session, weighed down by concerns over the outlook for monetary policy and AI disruption in the tech sector.
However, XRP ETFs are recording inflows, which should offer some support. XRP ETFs are on track to book a second straight week on net inflows, even if they are low at $3.15 million.
Earlier this week, Ripple announced a partnership with Aviva Investors as part of a broader mission to bring real-world assets to the XRP Ledger through tokenisation.
However, retail interest in XRP has been weak as Futures Open Interest (OI) dropped to $2.31 billion on Thursday from $2.44 billion and has been on a downward trend since reaching a record high of $10.94 billion in June.
XRP technical analysis
XRP broke out of a falling wedge pattern, dropping to a low of 1.13, before rebounding higher. The recovery is testing the resistance of the falling trendline boundary of the wedge pattern. The RSI and MACD project a bearish outlook.
A rejection at the trendline resistance could lead the price to decline toward the 1.13 support level. A break below here creates a lower low, bringing 1.10 into play.
Should the price rise above the trendline resistance, this would open the door to the 50 SMA and the horizontal resistance at 1.83.
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