Inflation Under Control?

Markets Still See July Hike

This week’s report revealed CPI inflation for June dropped to 3.0%, which was lower than the consensus of 3.1%.

Core CPI, which excludes the more volatile factors of food and energy, fell to 4.8% vs the expected 5.0%. This is the first time since December 2021 that Core CPI has registered below 5%.

Further evidence that the enduring battle against inflation may be coming to an end was Thursday’s PPI figures, which came in lower than consensus. Headline PPI crumbled to just 0.1% from 0.9% previously, and Core PPI cooled to 2.4% from 2.6% prior.

The stock market gapped higher and crypto followed in the wake of this release. It feels like an all-out party right now. Can this continue? Stay tuned as we review the charts shortly!

News Headlines

  • Standard Chartered Bank predicts Bitcoin will reach $120,000 by the end of 2024
  • Former SEC chair Jay Clayton says a spot Bitcoin ETF should be approved
  • Bank of America was ordered to pay $250 million for illegal fees to users along with unsolicited credit-card accounts
  • Former Celsius CEO Alex Mashinsky was arrested on fraud allegations
  • Jacobi Asset Management announced the launch of Europe’s first Bitcoin ETF
  • US judge rules Ripple $XRP is not a security
  • Coinbase reinstates Ripple $XRP on its trading platform

Now onto macro insights for the week ahead.

Economic Calendar

Highlights

  • None

There are no high-impact events in the upcoming week. Retail sales, housing data and jobless claims are low-medium impact at best. This makes it a relatively stress-free week for traders, although it may come with less opportunity in the form of volatility.

Charts

Bitcoin 4H Chart

Last week we noted this 29.5-31.5k range, and price has successfully tapped the upper edge again with a brief throw-over. If price is able to find acceptance above 31.5k, continuation toward 32-35k looks likely. A potential pullback from here could take it toward 30.6k (local HVN). That’s a high-likelihood bounce area.

S&P500 Weekly Chart

SPX is now in full breakout mode, making fresh 52-week highs above 4500. A clean level to retest would be 4450, and bulls would need to hold 4328 on any sharper pullback. Looking up at 4589, 4710, and 4819 (ATH) as next levels.

We are now less than 7% away from all-time highs.

Total2 Market Cap Daily Chart

Overall market cap without BTC got the higher low we were previously looking for and is now back at resistance. This is an important pivot level at 617B. You may like to call it 620B for a wider margin of safety. Price acceptance above there can lead to quite an altcoin rally, but some caution is to be advised until then.

That’s all for today. Have a great weekend!

Jay Charles

Editor in Chief, The Trading Tank.

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