ETH Waits for US Retail Sales to Target $1,300 on NASDAQ Index Support
Monday, bitcoin (BTC) increased by 1.72%. Partially reversing a 2.80% decline from Sunday, BTC ended the day at $16,626. Notably, BTC recorded the second gain of nine sessions while ending the day below $17,000 for the fourth time since 2020.
A bearish start to the day saw BTC slide to lows of $15,822. BTC dropped to the first major support level (S1) at $16,081. However, avoiding the second major support level (S2) at $15,818, BTC hit a high of $17,200 in the early afternoon. BTC broke through the first major resistance level (R1) at $16,782 before ending the day at $16,626.
Contagion risk weighed on investor sentiment heading into Tuesday’s session. Media coverage of the FTX the collapse and related companies tested investors’ appetites. However, the Binance launch from the crypto recovery fund limited the decline.
Early in the afternoon session, US economic indicators and market bets on a December Fed gave support from NASDAQ and the crypto market.
Weaker headline inflation numbers fueled bets of a Fed pivot in December, with the likelihood of a 75 basis point rate hike slipping to 14.6%, according to the FedWatch tool. A week ago, the odds of a 75 basis point rate hike stood at 43.2%
However, new FTX-related liquid freeze drawdowns citing the FTX collapse tested investor sentiment late Tuesday and early Wednesday. Although Binance’s recovery fund has provided support, the size of the fund remains unknown as more market participants commit to the fund. The details could give the market another boost.
Away from the crypto market, current US retail sales numbers and the NASDAQ Composite Index may provide additional guidance. On Tuesday, BTC and ETH showed sensitivity to US statistics and NASDAQ, suggesting a normalization of market conditions.
A jump in US consumption could raise doubts about a pivot from the Fed, which would put more emphasis on the chatter of FOMC members. FOMC members Barr, Williams and Waller speak today.