Bitcoin surged 2.43 percent at one point during Thursday’s 24-hour trading session, surpassing Ethereum by 2.13 percent prior to the release of December CPI data by the US Department of Labor.
Despite the fact that inflation decreased for the month ending in 2022, with the consumer price index increasing 6.5% in December compared to 7.1% in November, the labor market remained tight.
Crypto Rate Hike
Initial claims for the week ending January 7 totaled 205,000, a decrease of 1,000 from the previous week but below the 215,000 claims predicted by analysts.
After the 0.5% rate hike in December signaled a shift in the Federal Reserve’s policy stance, traders and investors anticipate that the Fed will continue to ease off on rate hikes in 2019.
The solid economy may signal that the Fed is lowering inflation without causing a US recession, despite the market’s desire for greater unemployment claims to back the CPI figures.
Technically speaking, the S&P 500 and Ethereum reached their respective 200-day simple moving averages (SMAs), which may explain why the general market and the cryptocurrency sector paused in a bullish trend.
The 200-day simple moving average is a leading indicator that indicates whether an index or security is in a bull or bear market, and it is improbable that security would surpass this level on the first attempt.
Read more: Crypto 2023: How is cryptocurrency taxed?
Why Bitcoin, Ethereum Stocks Are Increasing?
Several crypto-related stocks, including Marathon Digital Holdings Inc, Riot Blockchain Inc, and MicroStrategy Inc, are trading higher on Thursday as the cryptocurrency market surges, powered by increases in Bitcoin and Ethereum.
In tandem with broader risk assets, the cryptocurrency market has risen over the past week as investors continue to digest inflation data and consider the Federal Reserve’s next move.
The SPDR S&P 500 climbed on Thursday morning after the Labor Department reported that the consumer price index rose 6.5% in December, in line with the average forecast of economists.
Uncertain if Thursday’s better-than-expected news would be enough to slow the Fed’s rate hikes. The crypto market, however, is extending gains alongside traditional markets following the publication.
Marathon Digital is involved in digital asset mining. The stock was up 11.4% as of our most recent check.
Riot Blockchain focuses on the development, maintenance, and operation of blockchain technologies. The stock rose 6.5% as of Thursday morning.
MicroStrategy is a company that provides corporate intelligence, mobile software, and cloud services. As the company has more than 130,000 Bitcoin, it is primarily a gamble on Bitcoin. MicroStrategy stock was up 3.85 percent at the time of writing.
At the time of writing, Bitcoin’s 24-hour price of $18,306 was up 5.09%, while Ethereum’s price of $1,404.27 was up 5.3%.