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Bitcoin, Ethereum, Dogecoin Dragged Down By Soaring US Inflation — Why Are Crypto Traders Still Bullish In Uncertain Times?

Published 11/03/2022, 02:13
Updated 11/03/2022, 03:10
© Reuters.  Bitcoin, Ethereum, Dogecoin Dragged Down By Soaring US Inflation — Why Are Crypto Traders Still Bullish In Uncertain Times?

© Reuters. Bitcoin, Ethereum, Dogecoin Dragged Down By Soaring US Inflation — Why Are Crypto Traders Still Bullish In Uncertain Times?

Bitcoin traded under the psychologically important $40,000 level at press time on Thursday evening, with the global cryptocurrency market cap falling 4.35% to $1.75 trillion.

Price Performance Of Major Coins Coin 24-hour 7-day Price
Bitcoin (CRYPTO: BTC) -6.1% -5.6% $39,300.01
Ethereum (CRYPTO: ETH) -4.3% -5.2% $2,596.16
Dogecoin (CRYPTO: DOGE) -3.8% -8.1% $0.12
Top 24-Hour Gainers (Data via CoinMarketCap) Cryptocurrency 24-Hour % Change (+/-) Price
ICON (ICX) +41.5% $0.93
Waves (WAVES) +30.53% $28.71
ThorChain (RUNE) +11.1% ​​$4.91
See Also: How To Buy Bitcoin (BTC)

Why It Matters: On Thursday, the U.S. Labor Department released inflation numbers for February. Headline consumer price index or CPI rose 7.9% in the month, above an estimated 7.8%, the biggest increase since January 1982.

Risk assets moved lower after the inflation data. The S&P 500 and the Nasdaq closed 0.4% and 0.95% lower at 4,259.52 and 13,129.96, respectively.

Cryptocurrencies moved in line with stocks and headed downwards. However, some analysts are of the view that the apex coin may emerge as a hedge against inflation.

“Maybe the short-term price will drop due to panic, but long-term I think #Bitcoin is by far the best bet against inflation,” tweeted Michaël van de Poppe, a cryptocurrency trader.

The co-founders of on-chain analysis company Glassnode, Jan & Yann, tweeted that commodities look strong and there is a “rotation to value.”

A chart shared by them, depicting the top 10 assets by market cap, reveals a 15% decline in the year-to-date performance of Bitcoin, while gold shot up 14%.

Meanwhile, the put/call ratio for Bitcoin hit a six-month high of 0.69 in February amid bearish market sentiments, according to Delphi Digital.

On Thursday, the volume-adjusted put/call ratio hit a monthly low of 0.44 as call volumes rose. Deribit traders were buying April 29 BTC calls for $42,000, $50,000 and $60,000 strikes, Delphi said, boosting the notional value up to $193 million on the exchange.

“This might indicate that traders are turning bullish, even in an uncertain macro environment.”

BTC Options Open Interest Vs BTC Put/Call Ratio For Open Interest and Volume — Courtesy Glassnode

Ethereum has formed a stronger correlation with the S&P500 index than Bitcoin over the past month. Gold has a “spot-on” inverse correlation with the two largest cryptocurrencies by market cap, according to financial market data and content platform Santiment.

Read Next: Investing Stimulus Checks In This Cryptocurrency Would Have Fetched Whopping 23674% Returns Now

© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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Latest comments

all the information is useless. in crypto currency the supply demand zone work. let's see ahead Bitcoin will must be hit 12000 doller before going to 100k.
Who are the shortists that push Bitcoin below 40,000? If you know one - punch him in his face. Let Bitcoin skyroket, so simple people can make some money.
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