Price analysis 1/9: SPX, DXY, BTC, ETH, BNB, XRP, DOGE, ADA, MATIC, LTC
Investors across asset classes have been keeping a close watch on the United States Federal Reserve’s monetary policy because that sets the stage for a risk-on or a risk-off environment.
The strong rally in the U.S. stock markets on Jan. 6 and in cryptocurrencies over the weekend suggests that market observers anticipate the Fed to slow down its frantic pace of rate hikes. The optimism was fuelled by the greater-than-expected slowdown in wage gains in the December jobs report and the first contraction in U.S. services industry activity since May 2020. The next trigger that may influence the markets could be the Consumer Price Index data due on Jan. 12.
While the cryptocurrency markets may benefit from a risk-on environment, the extent of the up-move may be limited because of the issues plaguing Digital Currency Group. Therefore, along with the macroeconomic data, crypto traders must keep an eye on the news specific to the crypto space.
Could the strength in the S&P 500 (SPX) and the weakness in the U.S. dollar index (DXY) boost crypto prices higher? Let’s study the charts to find out.
After consolidating in a range for several days, the S&P 500 index broke above the 20-day exponential moving average (3,875) on Jan. 6. This suggests that the uncertainty has resolved in favor of the buyers.
The bulls will try to strengthen their position by pushing the price to the downtrend line. This is an important level to keep an eye on because a break and close above it could signal a potential trend change. The index could then rally to 4,100 and later to 4,325.
Contrary to this assumption, if the index turns down from the current level or the overhead resistance, it will suggest that bears continue to sell on relief rallies. The bears
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