on the crypto
The cryptocurrency market reacted marginally after the US Federal Reserve and the European Central Bank (ECB) hiked interest rates by just 25 basis points and 50 basis points respectively. However, Bitcoin failed to break through the $24.200 resistance level due to a possible recovery in the US dollar index.
This week could be a very critical time for them Investors in cryptocurrencies, as several events are expected that will determine the prices. These range from the anticipated appearance of Fed Chair Jerome Powell to the press, to the early release of the latest CPI inflation data (CPI) from Germany and the release of new data on initial jobless claims in the US. Finally, the University of Michigan is to publish US Consumer Expectations and Consumer Confidence.
Jerome Powell press conference
Investors are eagerly awaiting Powell's speech at the Economic Club of Washington on Tuesday as some clarity may be shed on the direction of rates. Investors are also expecting more clarification on his comments following last week's 25 basis point hike.
Commenting on the stock market and cryptocurrency reaction ahead of the press conference, Sinead Colton Grant, Global Head of Investor Solutions at BNY Mellon Wealth Management, said:
I think the market is in a revaluation mode, which is why the markets have pulled back a bit, certainly after the jobs report, and today we're seeing a little more of that… I think there will probably be an attempt to tone down the reaction to the press conference statements.
Inflation data from Germany and US labor market in focus
The early release of the German Consumer Price Indices (CPI) for the month of January will be presented this week. It should be remembered that the previous percentage point fell to 8,6.
Experts, however, are expecting an increase to 9,2 for the month under review. This too could be a major challenge, as the increase in consumer prices may be far from reaching a reasonable point.
It is important to note that the bearish stock market reaction in Germany could negatively affect the euro. This could allow the US dollar to gain more strength. In this case, the Bitcoin price consolidation in the last trading days could be expanded.
US Consumer Confidence and Consumer Expectations to close out the week
Official data on consumer expectations and household confidence for January will be released this week. It is recalled that US consumer confidence rose to 62,0 in the January 13 release.
If the current release reveals a surge in consumer expectations and confidence in this economic period, there could be an improvement in Amazon and Apple's sales development.
Cryptocurrency investors are also awaiting survey data from the University of Michigan this week. Strong data could lead to a bullish trend in the prices of the S&P500 and the Nasdaq technology index. This could also have a big effect on the cryptocurrency market.