- Tezos saw its price action flip-flopping following low U.S inflation and improved investor enthusiasm.
- XTZ price seems primed for uptrends, but caution remains crucial.
- Expect a 10% upside move, and a Fed official signals distress.
Tezos saw its price bouncing amidst Wednesday’s euphoria when U.S CPI plunged beneath estimates, emerging as lower-than-anticipated – good news for the markets. The data showed that living costs would start stabilizing following steep plunges within the past six months.
Though this narrative remained supportive and supported Tezos’ 8% upside move, a dovish Fed official stated that the central bank would progress with rate hikes and there’s a need to resort to increasing them at an unbearable pace. Such a narrative might mean upcoming trouble for crypto investors.
XTZ Rally: Handle with Care
Tezos price remains primed for upside past the monthly first crucial resistance at $1.96. That’s despite witnessing a miner rejection early today. The level becomes somewhat challenging for bulls, as they failed to overcome it on 8 August.
Risks remain as the mentioned resistance might turn to a double-top, capping price action in the upcoming future. Furthermore, investors in each market segment should beware of the warnings from several Federal members highlighted upcoming Fed moves.
XTZ price surged following faded rate hike projections. For now, markets expect a 50pb hike in September, not the earlier forecast of 75bp. That saw investors joining risky assets. However, several Federal officials emerged some hours later claiming that the Fed Reserve would introduce more hikes.
Furthermore, a dovish member repeated that message. That represents a massive sign that XTZ’s ongoing rally could only hit $2.25 before dropping after the Federal confirms another 75 basis point hike, exceeding expectation.
In the limited upside narrative, a minor technical rejection is the potential double top around the monthly resistance.
A bearish case would see a fade unfolding, and prices breaking beneath Wednesday’s lows might see XTZ plummeting towards a monthly pivot, looking for support. That can see it securing footing at $1.64 or the 55-day SMA at $1.60.
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