The wider cryptocurrency asset class has built on 2023 gains and the surge post US CPI to extend gains over the weekend. Ethereum (ETH) has sent particularly bullish signals on the chart and has positive price forecasts.
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Cryptocurrency Prices Surge Post US CPI
In Friday’s report we highlighted the bullish technical signal from Bitcoin (BTC) in the wake of a wider “risk on” move seen across global asset prices after the release of the US CPI data.
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This data was better than the consensus expectations by analysts, as the Month over Month inflation reading fell by 0.1%, with average forecasts for 0.0%, with this data not having fallen since May 2020. The YoY data came in line with markets expectations at 6.5%, as did the core CPI data (excluding food and energy prices).
The broader risk on theme that had already started off 2023 was reinforced by this data and although global equity markets rallied, the world of decentralised finance has led the charge higher, with cryptocurrencies, stablecoins altcoins and meme coins markets all posting significant, bullish signals since Friday. Here we look at the buoyant progress and upbeat forecasts for Ethereum
Ether Bull Signals
Ethereum had already had a strong start to 2023 rallying from late 2022 support at 1151 and last week overcoming the December swing peak at 1351 for a bullish Dow Theory reversal signal, even before the US inflation data was released.
In addition, the ETH market managed to reverse above the bear trend lien from August 2022 on Thursday and added to these bullish technical signals before and after the US CPI data on Friday. Furthermore, a gap higher over the weekend has seen Ether set up an even better intermediate-term base and recovery phase and point still higher for the seconds half of January and potentially on through Q1.
ETH Bullish Forecasts
Upside Threats: The January threat is now for an extension up to the pre-FTX collapse peak from early November at 1676. Beyond here would see targets for January/ February at 1789 and 2031 The Q1 upside threat is for a move closer to 2161 and possibly for an overshoot risk towards 3035/3180.
Downside Risk: Back below 1321 would open risk for a correction back to 1235, maybe to 1151.
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