The global cryptocurrency market has been struck with volatility ahead of Ethereum’s much-awaited transition to proof-of-stake (PoS). Crypto prices plunged yesterday as markets reacted to the latest US inflation report. Markets had been looking forward to August’s consumer price index (CPI) to come in at 8.1%, down from July’s 8.5%.
At the time of writing this article, Bitcoin was trading at $20,049 – losing 1.58% of its value in the last 24 hours as per data from CoinMarketCap. Ethereum is changing hands at $1,599, down by 0.25%. Bitcoin has to gain the 50-day moving average at $22,000 for support to have a chance of invalidating the pessimistic outlook, it can then move on to the 200-day moving average at $29,000. Ethereum also seems to create a head-and-shoulders pattern on its daily chart. Analysts believe a spike in selling pressure will likely validate this bearish formation. If it happens, a 30% correction to $1,000 could be triggered. As such Ethereum needs to make a run for the $1,800 mark to invalidate the bearish thesis. And if this happens, ETH would advance toward $2,100.
Crypto traders stepped back when the CPI came in at 8.3%. This led to a bloodbath across the crypto market. The altcoins also took a hit. Polkadot and Polygon MATIC lost nearly 2.40% in the last 24 hours, and Solana is down 2%. Data shows that more than $220 million worth of long positions were liquidated.