A risk-off sentiment dominated the macro trading conditions on Monday as concerns over the intensifying conflict between Israel and Palestine weighed on the cryptocurrency market. Bitcoin (BTC) experienced a slight decline of just over 1% in the mid-$27,000 range, while Ether (ETH) faced a more significant drop of over 3% to $1,580. The decline in Ether’s price was further exacerbated by an unexpected sale of $2.7 million worth of tokens by the Ethereum Foundation on the decentralized exchange Uniswap.
The recent price action in Ether suggests a bearish outlook in the near term. It has fallen below its 21 and 50-day moving averages (DMAs) and has also broken its upward trend that had been in play since early September. Traders are now eyeing the critical support level at $1,550, hoping to avoid a potential break below this level.
Bitcoin, on the other hand, has managed to stay within its recent uptrend, raising hopes for a sustained move above the crucial $28,000 mark in the coming weeks. However, the focus of the macro market is expected to shift from geopolitical tensions to economic data from the United States later in the week.
This data includes the release of US Producer Price Index (PPI) and Consumer Price Index (CPI) inflation figures on Wednesday and Thursday, respectively. The recent demand for safe-haven assets has led to a decline in US yields, but if the inflation data turns out to be hotter than expected, it could push yields back to multi-decade highs. This, in turn, might pose a headwind for the cryptocurrency market.
