The major story of cryptocurrency market this week has been the peaking of BTCUSD following the rebound that started three weeks ago. Bitcoin is retracing lower after the Labor Department reported on Thursday US consumer prices surged 7.5% over-year in January, the biggest annual increase in inflation in 40 years.
Global stock markets fell on US inflation data. Interestingly enough Bitcoin followed suit. The reversal of Bitcoin’s upward momentum is noteworthy since many investors cite cryptocurrencies as investments they perceive as inflation hedge versus fiat currencies that are subject to central bank inflationary policies. One would expect an inflation spike would boost cryptocurrency appeal, however Bitcoin reversed its rising on the news.
As the BTCUSD chart below indicates the Bitcoin will continue retreating to test the Fibonacci 23.6 level next week.
And as to more specific daily cryptocurrency market developments, see below.
The Central Bank of Ireland said on Tuesday it is "highly unlikely" to allow retail investors to be exposed to crypto assets. The bank cited "the specific risks attached to crypto assets" and "the possibility that appropriate risk assessment could be difficult for a retail investor without a high degree of expertise."
The US Department of Justice had good news later on Tuesday for hapless victims of 2016 hack of the crypto exchange Bitfinex. Federal officials seized some $3.6 billion worth of bitcoin tied to the Bitfinex hack. Some 120,000 Bintocion was stolen in the 2016 hack, representing nearly one-sixth of the total trading volume at the time. The DOJ however only seized about 94,000 Bitcoin valued at $3.6 billion. Looks like many investors will recover their losses from the hack.
