Ethereum and Ripple experienced a notable rebound this week after retesting crucial support levels. This recovery suggested a potential rally on the horizon. However, the unexpected decline in the United Kingdom's retail sales for December presents challenges for these cryptocurrencies.
The UK Retail Sales report revealed a year-on-year increase of 3.6%, falling short of market expectations set at 4.2%. This data weighed heavily on the GBP/USD, which experienced renewed selling pressure. The currency pair accelerated its decline below 1.2200 during Friday's European trading session.
As Ethereum and Ripple navigate these challenges, the broader market faces additional economic factors. The expectation of further rate cuts by the European Central Bank exerts downward pressure on the Euro. This development has led to the EUR/USD weakening, with the pair trading near 1.0300 in early European trading on Friday.
Simultaneously, the US Dollar is regaining strength amid a cautiously optimistic market sentiment. Despite this, mid-tier US economic data is still awaited, which could further influence currency dynamics. The demand for the US Dollar negatively impacts various currency pairs, including GBP/USD and EUR/USD.
In the realm of cryptocurrencies, Bitcoin continues its positive trajectory. Trading above $109,000 on Friday, Bitcoin's price has rallied almost 7% over the past week, showcasing resilience amidst fluctuating market conditions.
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