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Bitcoin moves higher towards record highs
Bitcoin rose on Wednesday and resumed the gains after a two-day hiatus, and moved once again towards record highs but the price is still seeking a fair valuation.
Now traders await crucial US inflation data later this week to gauge the likely odds of a Federal Reserve interest rate cut next week.
Prices
Bitcoin rose 1.9% at Bitstamp to $98,491, with a session-low at $95725.
On Tuesday, bitcoin fell 0.85%, the second loss in a row on profit-taking off record highs.
Crypto Market Value
The market value of cryptocurrencies rose $45 billion on Wednesday to a total of $3.653 trillion, as both bitcoin and ethereum rallied.
Exchange Funds
After bitcoin’s tumble below $16,000 in late 2022, the cryptocurrency experienced a renaissance after the approval of bitcoin exchange traded funds in the US in January.
The funds provided opportunities for institutional investors to invest and get exposure to bitcoin.
Following Trump’s election win, more than $4 billion of investments flowed into bitcoin funds in the US, reflecting increasing optimism.
US Rates
According to the Fedwatch tool, the odds of a 0.25% Fed interest rate cut stood at 85% for December.
Now investors await mainline US inflation data for November, with consumer prices expected up 2.7% h/h, up from 2.6% in October, while core prices are expected up 3.3%.
US dollar widens gains to two-week high before US inflation data
The US dollar rose in European trade on Wednesday against a basket of major rivals, expanding the gains for the fourth straight session and hitting two-week highs as US 10-year treasury yields rallied.
It comes despite high pricing for the odds of a 0.25% US interest rate cut next week, with investors still waiting for important American inflation data later this week to get a clearer picture.
The Index
The dollar index rose 0.4% today to 106.81, the highest since November 27, with a session-low at 106.27.
On Tuesday, the dollar index rose 0.2% as US yields gained ground as well.
US Yields
US 10-year treasury yields rose 0.3% on Tuesday, extending gains for the third straight session, in turn boosting the dollar’s standing.
US Rates
According to the Fedwatch tool, the odds of a 0.25% Fed interest rate cut stood at 85% for December.
Now investors await mainline US inflation data for November, with consumer prices expected up 2.7% h/h, up from 2.6% in October, while core prices are expected up 3.3%.
Gold gives up two-week high before US inflation data
Gold prices fell in European trade on Wednesday for the first time in four days, moving away from two-week highs on active profit-taking and under pressure from the stronger dollar.
Now investors await mainline US inflation data for November, which will shed light on inflationary pressures on the Federal Reserve’s policymakers.
Prices
Gold prices fell 0.7% today to $2675 an ounce, with the highest since November 25 at $2704.
On Tuesday, gold prices rose 1.3%, the third profit in a row on actual demand in China, while haven demand rose as well.
The Dollar
The dollar index rose 0.3% on Wednesday, expanding the gains for the fourth straight session and hitting a week high at 106.68 against a basket of major rivals.
A stronger dollar makes the greenback-denominated gold futures cheaper to holders of other currencies.
US Rates
According to the Fedwatch tool, the odds of a 0.25% Fed interest rate cut stood at 85% for December.
Now investors await mainline US inflation data for November, with consumer prices expected up 2.7% h/h, up from 2.6% in October, while core prices are expected up 3.3%.
SPDR
Gold holdings at the SPDR Gold Trust remained unchanged yesterday at a total of 870.79 tons, the lowest since November 15.
