Investors Look Towards PMI Data for Crypto Market Direction

  • Last Friday, Bitcoin and Ethereum experienced sharp price drops, losing over 5%.
  • Crypto prices would rise or fall depending on the outcome or general perception of events like the PMI.

The crypto market trend has been difficult to predict in the past few weeks. After a classic rally at the beginning of the year, crypto prices have entered a horizontal channel characterized by volatility fueled by macroeconomic factors. Events lined up for the coming week suggest we may see more volatility and price action that will determine the market trend for March 2023.

The past week ended with a sharp decline in crypto prices. Last Friday, the two leading cryptocurrencies, Bitcoin and Ethereum, experienced sharp price drops. Both cryptos lost over 5% of their value within the trading day, changing the mood of the entire market.

Dropping prices has pushed the crypto market towards critical support. Breaking below this region could lead to a more significant correction in the market.

Last week’s price slump connects to some events in the macro-sector, including the SEC’s investigation into Binance and the financial crisis rocking Silvergate. The crypto market intertwines with the macro sector, meaning investors now pay close attention to such macro events. Crypto prices would rise or fall depending on the outcome or general perception of such events.

In the new week, the U.S. will release its Purchasing Managers’ Index (PMI) data. This data would reflect the health status of various industries, including the cryptocurrency market. A closer look at the PMI could reveal the level of institutional adoption of cryptocurrencies, the extent of innovation and development, and the prevailing regulatory status of participants in the sector.

Depending on the outcome of this data and how industry stakeholders interpret it, we may see a significant move in crypto prices. The impact of the PMI could initiate a trend that would sustain the market direction for weeks to come.

Other crucial events expected to impact the crypto market in the coming weeks include the Federal Reserve Meeting scheduled for March 22 and the Bitcoin Difficulty Adjustment. That is a bi-weekly event that helps to maintain the network’s stability and security.

Related Articles

Back to top button