Bitcoin bounces back. Is the bottom in?

Now, let's not get ahead of ourselves here, this isn't a call that the market has bottomed out. There is always a possibility that there will be additional downside room in the months to come.

However, we can't ignore a market that seems to be gaining momentum. The price of Bitcoin is up nearly 40% from its recent lows ($17,600), while many other cryptocurrencies, such as Ethereum (84%), Avax (92%), and the Altify DeFi Bundle (49.46%) continue to outperform it.

Why Is the Market Bouncing?

‍There has been bad news after bad news in 2022 as the world struggles with high inflation and a slowing economy. As a result, US inflation for June came in at 9.10%, which is the highest inflation print in 41 years.

So why would crypto bounce after the highest US inflation print in 41 years?

Well, we could be witnessing a classic market dynamic called, “Sell the rumour, buy the fact”. 

This dynamic presents itself when investors decide to sell their assets ahead of a big economic data announcement (US inflation) in anticipation of an alarming number. Once this economic data point is out the way and known, investors look to repurchase their assets, causing a rally in price.‍

The Technical Corner

‍From a technical analysis perspective, many analysts believe Bitcoin will rally to about $26,000-$28,000 where they believe it will face some resistance (resistance is a price level that many think will be hard to overcome). According to technical analysts, Bitcoin will continue to run higher if it holds the $22,000 level. It would provide some much-needed relief for the crypto market and could lead to multiple altcoins taking off in a very nice upward trend.