Bitcoin’s halving reduces miner rewards, tightening the supply of new coins. Historically, this event has led to price increases as reduced supply meets consistent or growing demand. However, broader market conditions also influence the outcome.
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Macroeconomic data such as employment reports or Consumer Price Index (CPI) numbers play a significant role in shaping market sentiment. Strong employment figures or low inflation often indicate a healthy economy, which may lead investors to favor traditional assets like stocks or bonds, causing a shift away from riskier assets like cryptocurrencies. Conversely, high inflation or weak economic data can drive demand for alternative stores of value, such as Bitcoin, seen as a hedge against inflation. Thus, the crypto market is sensitive to these data points as they influence broader investor behavior and expectations for central bank policies.
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RSI is a momentum oscillator that ranges from 0 to 100, helping traders identify overbought or oversold conditions. When RSI crosses above 70, it suggests the asset may be overbought, signaling a potential price correction. Conversely, when RSI falls below 30, it indicates the asset could be oversold, potentially leading to a price rebound. In the highly volatile crypto market, RSI helps traders spot overextension in either direction, providing key entry or exit signals to capitalize on potential price reversals.
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