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Market Wrap: Bitcoin Heads for Best Week in 3 Months

The largest cryptocurrency’s push past $20K this week has turned the market more bullish. The outlook hinges on the Federal Reserve’s messaging next week – about its plans for December. Market Wrap is CoinDesk’s daily newsletter diving into what happened in today’s crypto markets.Read MoreCoinDesk

Bitcoin (BTC) rose Friday after a U.S. government report showed the Federal Reserve’s preferred inflation gauge rose slower than expected last month. The reason that matters is because it shows progress in the Fed’s campaign to tamp down the pace of price increases, in turn signaling that it might be able to let up sooner rather than later in tightening monetary policy – seen as a negative for prices of risky assets, from stocks to bitcoin.

The oldest cryptocurrency’s push past $20,000 has turned the market mood more bullish. Bitcoin’s 5.6% gain since Sunday represents the biggest weekly gain in three months. But the crucial test will come next week when the Federal Reserve’s Federal Open Market Committee meets. Most traders expect the U.S. central bank to raise the main interest rate by 75 basis points (0.75 percentage point), but the drama is likely to come from whatever Fed Chair Jerome Powell signals about the committee’s plans for its December meeting.

The CoinDesk Market Index (CMI), a broad-based market index that measures the performance of a basket of cryptocurrencies, recently rose 1.8% over the past 24 hours.

In traditional markets, the Standard & Poor’s 500 rose, with tech stocks boosted by an encouraging earnings report from Apple.

Among crypto stocks on Friday, shares of bitcoin miner Core Scientific (CORZ) tanked after the company warned it may have to explore bankruptcy.

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CoinDesk Market Index (CMI): 1,018.27 +0.4%

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Bitcoin (BTC): $20,646 +0.8%

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Ether (ETH): $1,562 +2.0%

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S&P 500 daily close: 3,901.06 +2.5%

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Gold: $1,648 per troy ounce -0.8%

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Ten-year Treasury yield daily close: 4.01% +0.1

Bitcoin, ether and gold prices are taken at approximately 4pm New York time. Bitcoin is the CoinDesk Bitcoin Price Index (XBX); Ether is the CoinDesk Ether Price Index (ETX); Gold is the COMEX spot price. Information about CoinDesk Indices can be found at coindesk.com/indices.

By Glenn Williams Jr

“Whale” movement of BTC to exchanges (Glassnode)

Investors should also weigh on-chain analytics to ensure they are adopting a measured approach. Over the past week, large BTC holders have been moving coins to exchanges.

For investors with a bullish outlook, this isn’t the best sign because coins are often moved to exchanges to ready them for rapid sale.

However, this trend may just be a preventative measure ahead of Nov. 10 consumer price index data. Still, the move to exchanges appears to have stabilized as of Oct. 25.

Read the full technical take by CoinDesk analyst Glenn Williams Jr.

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Sector classifications are provided via the Digital Asset Classification Standard (DACS), developed by CoinDesk Indices to provide a reliable, comprehensive and standardized classification system for digital assets. The CoinDesk Market Index (CMI) is a broad-based index designed to measure the market capitalization weighted performance of the digital asset market subject to minimum trading and exchange eligibility requirements.