BTC, DOGE, XRP May Hit Resistance as S&P 500 Wedge Pattern Raises Bull Trap Concerns; Inflation in Focus

Bull Trap Alert: Crypto Gains Face Macro Headwinds

Bitcoin and Ether are showing strong technical setups, but caution is warranted as U.S. equities signal potential turbulence.

Bitcoin & Ether Rally, but Macro Risks Loom
Bitcoin (BTC $114,207.77) confirmed a bullish inverse head-and-shoulders breakout, suggesting a target near $120,000. Ether rose in tandem, reflecting broad crypto market optimism.

However, the S&P 500 E-mini futures are forming a rising wedge after hitting a record $6,542, a bearish reversal pattern that indicates slowing momentum. Traders warn that a sharp equity pullback could weigh on cryptocurrencies, particularly if Thursday’s U.S. CPI data comes in hotter than expected. August CPI is forecast at 2.9% YoY, while core CPI is projected at 3.1%, both above the Fed’s 2% target.

Options and Institutional Flows Signal Caution
BTC and ETH 25-delta risk reversals remain negative to December expiry, showing demand for downside protection. Institutional hedges, including large ETH puts, suggest that traders are guarding against a near-term pullback.

Altcoin Action
XRP continues to consolidate within a descending triangle and the Ichimoku cloud, hinting at indecision. A breakout above $3.00 could pave the way to $3.38, but the current pattern remains cautious. Dogecoin (DOGE) is outperforming, reclaiming its June bullish trendline and rising above the Ichimoku cloud, with potential to test July highs at $0.2876. Yet, DOGE gains may be capped if the S&P 500 experiences a sharp reversal.

Bottom Line
While technical indicators for BTC and DOGE are constructive, macro signals—including a potential S&P 500 pullback and U.S. inflation readings—require traders to remain vigilant.