TA Tuesday: BTC and ETH see declines; CPI data awaited

Week-over-week performance:

  • BTCUSD: 30,470, -1.93%
  • ETHUSD: 1,879, -3.84%
  • US02Y: 4.85%, -9bps
  • DXY: 101.78, -1.66%
  • GOLD (USD/OZ): 1,928, +0.2%
  • NDX: 15,045, -1.72%
  • VIX: 15.06, +11%

On the macro side:

We just received the latest employment data, and despite the job report showing an increase of 209,000 jobs (with a downward revision of 110,000 jobs for April and May), there are positive indications in the labor market. Average hourly earnings have risen by 4.4% year-on-year, and June witnessed a rise in hours worked, while the unemployment rate dropped to 3.6% instead of the expected 3.7%.

With a persistently strong labour market and core inflation remaining stable, it seems that the Federal Reserve now has the green light to maintain higher interest rates. Therefore, it is likely that they will proceed with another rate hike at their July meeting, unless the CPI print this week shows a weak reading.

As we approach the release of the CPI data this week, we anticipate it to be a relatively uneventful and inconspicuous event. However, if there is an unexpected decrease in the CPI, it could also have a positive impact on the prices of digital assets. Otherwise, it is expected that the market has already factored in the upcoming rate hike.

On the crypto side:

Investors are currently closely monitoring the regulatory landscape in the US, particularly regarding ETFs, XRP, and Greyscale. However, it is important to note that resolving these matters may take a significant amount of time.

In relation to Spot Bitcoin ETFs, several well-known entities have submitted applications, and there are multiple SEC final deadlines scheduled for March 2024.

Chart 1: Upcoming spot Bitcoin ETF deadlines, src: Bloomberg

Regarding the spot market, if there are no surprises in the CPI, it appears that the downside accumulation phase is likely to continue. The RSI is trending lower, supporting the notion of a lower support level around $30,000 and a resistance level at $31,500.

Chart 2: btcusd 1d

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