Cardano price pulled back on Tuesday after the latest US consumer inflation data. ADA dropped to a low of $0.47, which was slightly below this week’s high of $0.51. Other coins like Ethereum, Solana, and ApeCoin also pulled back.
US inflation data
The Bureau of Labor Statistics (BLS) published the latest inflation data on Tuesday. These numbers revealed that the headline consumer inflation rose from 0.0% in July to 0.1%. This increase was better than the median estimate of -0.1%.
On a year-on-year basis, inflation rose by 8.3%, which was slightly lower than the previous month’s of 8.5%. The decline was higher than the median estimate of 8.1%.
Meanwhile, core inflation rose from 0.3% to 0.6%, which was higher than the median estimate of 0.3%. This increase translated to a year-on-year gain of 6.3%.
Analysts were expecting inflation to fall in August. Besides, the price of key items like automobiles and gasoline prices retreated sharply in August. The average gasoline price dropped from $5 to $3.8.
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Therefore, analysts believe that the Federal Reserve will continue hiking interest rates in the coming months. It has already hiked interest rates by 225 basis points and started implementing a quantitative tightening (QT) policy. Therefore, there is a likelihood that it will hike by 0.75% in its next meeting this month.
Cardano price decline was also in line that of other cryptocurrencies. Bitcoin dropped from over $22,000 to $21,445 while Ethereum fell from $1,700 to $1,620. The same is true with American stocks, with the Dow Jones and Nasdaq 100 fell by 560 and 340 points, respectively. Stocks have a close correlation with cryptocurrencies.
Cardano price prediction
The four-chart shows that ADA price dipped sharply on Tuesday after the latest American inflation data. It dropped from a high of $0.5235 to a low of $0.4715. Along the way, the pair moved below the 25-day and 50-day moving averages.
Cardano then moved to the lower side of the ascending channel that is shown in blue. The MACD has moved below the neutral level. Therefore, there is a likelihood that the coin will likely continue falling as sellers target the key support level at $0.450. A move above the resistance point at $0.50 will invalidate the bearish view.