Bitcoin is showing signs of recovery. In the last 24 hours, Bitcoin has gained by around 0.5%, trading at $17,612 at the time of writing. The broader cryptocurrency market also shows signs of recovery, gaining nearly 2% in the last 24 hours.
Bitcoin price analysis
Bitcoin is showing signs of recovery after a notable plunge this week. Yesterday, the price of the largest cryptocurrency by market capitalization dropped to below $16K amid market uncertainty caused by the situation with FTX and Alameda Research.
In the last 24 hours, BTC has reported increased volatility, trading between $15,663 and $17,789. Bitcoin’s market cap currently sits at $338 billion, giving it a market dominance of 36.7%.
The recent price decline means that BTC has dropped 74% from its all-time highs in November last year. Altcoins have also been dropping this week, with Ether dropping below $1,200 before slightly recovering.
The Bitcoin price chart shows a sharp recovery that has taken BTC’s price above $17K again. The relative Strength Index (RSI) is at 66, indicating that buyers might be coming back to the market and accumulating the coin at low prices.
A bullish sentiment is also painted by the Moving Average Convergence Divergence (MACD) line above the signal line. The movement of the MACD line shows that the bulls are at play, and BTC could be headed for a swift recovery.
Favorable CPI data is behind Bitcoin’s recovery
The recently released US Consumer Price Index (CPI) data shows that inflation levels for October were at 7.7%. The figure released by the US Bureau of Labour Statistics was notably lower than the earlier prediction of 7.9%.
The release of the data led to Bitcoin registering an uptrend within minutes. Stocks are also reacting positively to the news. This year, the correlation between the stock and crypto markets has seen the two asset classes trade in tandem.
The low inflation numbers could mean that the Fed will ease interest rates during the next Federal Open Market Committee (FOMC) meeting in December, which could trigger significant price gains.
Diversify your portfolio with these coins
While BTC has gained due to slowing inflation in the US, the coin and broader market is still not out of the clear as the market eagerly waits to see how the FTX insolvency case will unfold. Therefore, you need to consider diversifying your portfolio with these coins.
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