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Bitcoin struggles against 2-month resistance as’most despised’ stocks surge

After the release of U.S. inflation figures, risky assets jump higher, but there is little conviction in the emergence of a prolonged rise.

Bitcoin (BTC) breached the upper boundary of a persistent trading range on August 11 as a distinctly unpleasant surge seized control of risk assets.

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Bitcoin retracement alerts increase close to $25,000

TradingView data indicated that BTC/USD reached $24,750 on Bitstamp, marking its greatest performance since June 13.

In recent weeks, the pair had tried three breakouts to the top of its range, all of which failed in the face of intense selling pressure.

The release of new United States inflation statistics this week served as a long-awaited impetus for change, with Bitcoin and alternative cryptocurrencies soaring in tandem with equities as the Consumer Price Index (CPI) print for July indicated that inflation had peaked.

On the day of the release, August 10, both the S&P 500 and the Nasdaq Composite Index rose by 2.1% and 1.9%, respectively. On the other hand, the daily candle for BTC/USD was around $900.

As the dust settled, market commentators were not, however, overwhelmingly bullish. Raoul Pal, an investor, observed that sentiment viewed the post-CPI surge as a black sheep.

“Well, this appears to be one of the most despised rallies I’ve witnessed in a number of years in stocks,” he wrote in a Twitter thread.

Pal claimed, despite this, that there was a “very decent likelihood” that the market bottom occurred in June.

Il Capo of Crypto, a well-known trader and expert, forecasted a significant reversal in the crypto market’s trend and pegged the greatest likely target before a new decline began at $25,500.

“$BTC Increased by about 40%. Huge Possibility, Coming Back. Buy The Dip,” fellow Twitter user Jibon continued in subsequent tweets.

A marginally more optimistic Crypto Tony, meanwhile, stated that if the range high held, holders would be “in for a treat.”

BTCfuel said that a subsequent breakout was not ruled out in light of potential similarities between the Bitcoin chart today and in March 2020.

Concerns emerge over the Ethereum rally

After ETH/USD gained over 11%, the outstanding performance of altcoins thrust the largest altcoin Ether (ETH) into the spotlight.

The pair has surpassed $1,900 for the first time since June 6 and is now approaching the psychologically critical $2,000 threshold.

The CPI momentum added to an already exuberant Ethereum market, as the Goerli testnet merge — a crucial preliminary step for the September full Merge — was successfully completed.

“Since the beginning of this bear market rally in the middle of June, Ethereum has surpassed Bitcoin in terms of trading volume. In recent days, Ethereum and Bitcoin Dominance have even crossed,” CryptoQuant researcher Maartuun stated in a blog post on August 10.

Maartuun cautioned that historical precedence did not favour a durable cryptocurrency rally if ETH continued to lead the way.

“It is evident that Ethereum is extremely popular on exchanges due to its increasing domination. This makes sense in light of the imminent 2.0 merge,” he continued.

“However, based on my five years of cryptomarket expertise, Ethereum-led rallies are typically not healthy for the market. According to my earlier analyses, I am extremely conservative. Especially since Ethereum has already risen by greater than 100 percent from its lows.”

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Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.

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