As traders await July's inflation reading on August 10, bitcoin ( BTC-USD ) gave up some gains in Tuesday morning trading after rejecting $24K for the third time in the past month in what appears to be a strong level of technical resistance.
Bitcoin ( BTC-USD ) dipped 4.7% to $23.01K as of shortly before 10:30 a.m. ET, down from its weekly peak of $24.22K on August 8. And ethereum ( ETH-USD ), which is expected to undergo a transition to Proof-of-Stake from Proof-of-Work as soon as next month, fell 6.1% to $1.68K after reaching as high as $1.80K in the prior session.
"If Bitcoin consolidates around $23,000 or below for multiple days, then Bitcoin would have printed a lower-high, as it has not yet reached the previous high of $24,700," GlobalBlock analyst Marcus Sotiriou wrote in a note.
Similarly, the stock market is trading in the red, with the Dow Jones ( DJI ) -0.2% , S&P 500 ( SP500 ) -0.5% and Nasdaq ( COMP.IND ) -1.3% ., as the risk-on trend, especially in meme stock such as AMC Entertainment ( AMC ) -5% and GameStop ( GME ) -5.9% , takes a breather ahead of another highly anticipated CPI print.
Speaking of which, headline consumer prices are expected to moderate to +8.7% Y/Y in July from +9.1% in June as a string of commodity prices have come off their highs, including Crude Oil ( CL1:COM ) and Copper ( HG1:COM ).
When stripping out volatile food and commodity prices, though, CPI is anticipated to climb +6.1% in July from a year ago vs. +5.9% previously.
Moreover, "energy related inputs will probably start falling on a YoY basis, but rental inflation will stay elevated for another few quarter at least, providing ongoing CPI pressures," Patrick Saner, head of macro strategy at Swiss Re, wrote in a Twitter post .
If consumer price inflation overshoots, bond traders at the short-end of the Treasury curve could be prompted to price in bigger and faster Federal Reserve interest-rate increases since the central bank's priority now is to bring down inflationary pressures. In turn, the Treasury yield curve could steepen even more, as short-duration yields would further rise above long-duration ones.
Crypto-focused stocks: MicroStrategy ( MSTR ) -3.4% , Coinbase Global ( COIN ) -8.1% , Riot Blockchain ( RIOT ) -9.3% , Bitfarms ( BITF ) -7.8% , Core Scientific ( CORZ ) -8.9% , Galaxy Digital ( OTCPK:BRPHF ) -6.4% and SOS ( SOS ) -17.3% .
Meanwhile, an analyst at J.P. Morgan said crypto prices may have located a bottom as bitcoin, ether surged in July .
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Bitcoin fails to take $24K for third time in past month ahead of inflation print