Freshly released economic figures from the United States have sparked a bullish response in the cryptocurrency markets, with major digital assets Bitcoin (BTC) and Ethereum (ETH) experiencing significant gains. Shortly after the announcement, BTC’s value climbed by $1,000, and ETH’s price soared to its highest peak of the year 2024. Market participants should brace for potential volatility in the short term.
Market Reacts to US Inflation and Wage Data
The market’s increased risk appetite seems to be a reaction to the 3.9% inflation rate and favorable wage growth data from the US. The comments from US Treasury Secretary Yellen, suggesting that employment may not be putting upward pressure on inflation, hint at a possible inclination towards advocating for Federal Reserve interest rate cuts, even without significant labor market relaxation.
Interest Rate Speculations Fuels Optimism
The Federal Reserve had previously indicated that a surprise softening in employment might precipitate more aggressive and substantial interest rate reductions. The current upward trajectory of cryptocurrency values, specifically BTC and ETH, is underpinned by these macroeconomic trends and speculations regarding monetary policy.
ETH is currently flirting with the $4,000 threshold, and BTC has climbed to $68,708, eyeing new record highs. As the market continues to digest the news, altcoins could potentially experience double-digit percentage gains in anticipation of setting new highs. Conversely, a swift move to sell could precipitate a rapid decline in BTC’s value, potentially by $5,000 to $10,000. Active traders and investors should remain vigilant for signs of either continued growth or a sudden reversal of fortunes.