MATIC rises in Disney Accelerator program selection, AAVE and UNI also win

Market Update: Crypto resilient to US CPI and Hawkish Fed hot bets

Cryptocurrency prices have risen for most of the past 24 hours, although US Consumer Price Index (CPI) data showed that price pressures were much higher than initially thought last month. According to CoinMarketCap, bitcoin has recently traded about 1.3% higher over the period to trade near $20,000 with the 21-day moving average at $20,400 acting as resistance for now.

Ethereum, on the other hand, is recently up nearly 3.0% over the past 24 hours, trading near $1,100 after seeing a firm bounce from the key $1,000 level on Wednesday. The latest US inflation data sparked a build-up of hawkish Fed bets. Markets now suspect the Fed will hike rates by 100 basis points later this month, taking total rate hikes this year to 250 basis points. Markets are also increasing their expectations of what the Fed’s final rate will be in 2023.

The resilience of the cryptocurrency market to such developments is surprising. Back in June, when May’s CPI data surprised to the upside and led to a build-up of Fed bet tightening bets spat out crypto and other risky assets like stocks. Although crypto prices have proven resilient for now, bulls should not announce victory just yet.

The latest inflation numbers have dealt a blow to the notion that US price pressures have peaked. Uncertainty remains high as to when inflation will start, which will likely be a long and slow road back to the Fed’s 2.0% target. And that means that uncertainty about how much the Fed will ultimately have to raise interest rates remained high. Traders should be wary of anyone who announces with absolute confidence that the Fed will definitely cut rates in late 2023, even though US money markets are currently betting on it.

Here is a list of the top three trending coins of the day.

Polygon (MATIC)

According to a statement from Disney on Wednesday, Polygon, an Ethereum scaling tool, has been selected as one of six companies to participate in its 2022 accelerator program. According to Disney, the business development program is intended to support the growth of innovative companies.

Disney hopes the program will fuel the development of augmented reality, non-fungible tokens (NFTs), and artificial intelligence. According to its statement, Disney will advise each of the six companies through its executive team and assign each a dedicated executive-level mentor.

The announcement sent Polygon’s native token, MATIC, skyrocketing. According to CoinMarketCap, it is the best-performing cryptocurrency in the top 50 by market cap with gains of nearly 16% over the last 24 hours. The recent rally has seen MATIC/USD break out to the highest levels since early June in the mid-$6.0s.

The recent rally also has technical significance and could signal near-term improvement in the cryptocurrency’s fortunes. MATIC/USD was earlier struggling to break out of a downtrend that had limited price action until mid-May. Thus, the recent push above this downtrend opens the door for further upside towards $7.50.

The recent rally also confirms that MATIC’s uptrend remains intact from its mid-June lows in the low $3.0 area. On Wednesday, the 21DMA also rose above the 50DMA for the first time since mid-April, another potential indicator of a positive shift in near-term momentum.

MATIC/USD eyes are rising. Source: FX Empire

Aave (AAVE)

AAVE, the native token of the Aave Decentralized Finance (DeFi) liquidity protocol, is the second best-performing cryptocurrency in the top 50 by market cap over the past 24 hours, according to CoinMarketCap. During that period, the cryptocurrency is up nearly 12%, although it last traded around $79.0 after narrowly failing to test last Friday’s highs of $83.0.

However, AAVE’s near-term technical outlook is bullish. The recent rebound from this week’s lows below $70, where AAVE/USD found support at its 21DMA (at $67), has taken it above its 50DMA (at $77). If AAVE can close at current levels, it would be only the second close above its 50DMA since late April.

Technicians also note that AAVE/USD has been trending higher within an uptrend channel for the past few weeks. If this trend channel holds, a test of $100 seems likely sometime in August.

AAVE/USD is trending higher. Source: FX Empire

Uniswap (UNI)

UNI, the native token of the largest decentralized exchange (DEX) Uniswap, is the third best-performing cryptocurrency in the top 50 by market cap over the last 24 hours, according to CoinMarketCap. During this period, the cryptocurrency has also gained about 12%.

UNI/USD has now recovered nearly 20% from its Wednesday lows of $5.20 after finding support from Monday’s low and the 21DMA at $5.50, but it has yet to top the highs at current levels around $6.30 probing above $6.50 from last Friday. Technicians believe that a convincing break above the $6.50 resistance could open the door for a move up to the $8.0 resistance area.

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