Bitcoin fell back below $20 000 on Tuesday after enjoying its strongest week in more than three months last week, as a surge in the greenback rippled through global markets.
The largest cryptocurrency dropped as much as 2.6% to $19 870, declining for a fourth straight day ahead of US consumer-price data Tuesday. It hit $22 472 on Friday as risk appetite returned to broader assets. Second-largest Ether slid as much as 4.1% to $1 090.94. The MVIS CryptoCompare Digital Assets 100 index dropped as much as 2.6%.
“Expect apathetic back-end vol and basis flows in another summer trading week with CPI likely to be the main event on July 13,” Genesis’s Noelle Acheson and Gordon Grant said in a note Monday. “Notwithstanding a modicum of fireworks around last Friday’s weekly options expiry that saw Bitcoin blow through $22 000 and touch the 200-week moving average, with Ether pushing toward $1,300 in sympathy, the weekend session saw a resumption of choppy, downwardly oriented price action that has characterized recent months.”
The dollar jumped on Monday ahead of the CPI, which could offer insight into the Federal Reserve’s potential rate-hike path. Bitcoin and other cryptocurrencies have struggled as the central bank works to combat high inflation readings, and have tended to trade along with risk assets for the past couple of years.
Bitcoin is more likely to tumble to $10 000, cutting its value roughly in half, than it is to rally back to $30 000, according to 60% of the 950 investors who responded to an MLIV Pulse survey that ran July 5-8. Forty percent saw it going the other way.