Bitcoin Cash price is trading in the green for the second session in a row as optimism gradually returns in the cryptocurrency market. Better-than-expected economic data boosted the risk-on sector.
What’s driving the market?
Earlier in the week, the US Labor Department released data indicating that consumer prices in June rose at the highest pace in 41 years at 9.1%. The figures cast doubt that inflation had peaked.
On the one hand, cryptocurrencies have gained popularity as a hedge against inflation. However, the recorded surge in inflationary pressures have actually weighed on BCH price and crypto industry in general. As a knee-jerk reaction to the US inflation data earlier in the week, Bitcoin Cash dropped to its lowest level since December 2018 at $95.20.
Fast forward to Friday’s session and the better-than-expected US retail sales data boosted BCH/USD. According to the released figures, retail sales rose by 1.0% in June compared to the expected 0.3% and prior month’s -0.1%. That was the strongest pace in three months and are an indication that the US consumer is still in good shape despite the high inflation.
Notably, the data has eased concerns over a recession; an aspect that has boosted cryptocurrencies and other risk-on assets. Similar to the digital assets, the stock market has rebounded further in response to the released economic data. S&P 500 was at $3,863.17 as at the time of writing; erasing most of the week’s losses.
BCH price technical analysis
While Bitcoin Cash price will likely remain in a bearish trend in the ensuing sessions, I predict that it has found its short term support and will record more modest gains. Indeed, the 25 and 50-day exponential moving averages substantiate this argument as the crypto has bounced back above the indicators on a four-hour chart.
In particular, the range between $102.08 and $107.17 will be worth watching over the weekend. With further rallying, the bulls’ next target will be to retest July’s high of $113.66. On the flip side, a retreat past the range’s lower level may place the support at $98.37.
