Here is the Most Realistic Scenario in Bitcoin! Chilling Warning from the Experienced Analyst!
While Bitcoin (BTC) failed to deliver what was expected in November, current data and analyst comments reveal that there is still a risky process ahead of us.
Fed and FTX: What Kind of Process Is Waiting for Us?
After the speech of the US Central Bank governor Jerome Powell recently, Bitcoin gained momentum again. However, this rally has not been sustainable. Experts note that a rise above the $17,250 level will open the way to the $17,800 to $18,000 level. Since the last meeting, Fed officials have repeatedly advocated quantitative tightening. It came as a surprise that Powell said that “the process of reducing the pace of rate hikes could come just before the December meeting.” However, the Fed’s hawkish stance may somehow continue, according to experts. Powell also said that the fight against inflation is not over yet. Therefore, he pointed out, the Fed should keep monetary policy at restrictive levels “for some time”. As a result, it is too early for a concrete rally in Bitcoin.
In order for Bitcoin to rise, the dollar index (DXY) must fall. Gold and stocks also rose after Powell’s remarks. However, the risk of recession is also still high. Yesterday, Elon Musk reiterated once again that recession threatens the US and the global economy. Whether there will be a Christmas rally in December will depend on various factors that will probably leave Bitcoin facing serious headwinds. First of all, the Fed meeting on December 14 and the new CPI data to be released the day before will play a key role in determining whether Christmas will be green or red. In addition, Bitcoin investors should also pay attention to the domino effect caused by the FTX October, especially Genesis Trading and DCG. If DCG really only has a liquidity problem and can solve it, this will be a huge relief for the crypto market.
Recession and Critical Data!
There are also growing concerns about a recession, but if inflation continues to fall and the Fed announces a 50 basis point interest rate hike, it may stay on the back burner for now. This situation, potentially, will be a solid catalyst for a strong year-end rally. At the moment, with the miner capitulation looming, Bitcoin may be entering the closing stages of the bear market. The historical average duration is 14 months. He is currently 13. we’re on the moon. The anti-bitcoin Peter Schiff, as well as other analysts, are also warning of an impending recession. The fact that the impact of the Fed’s policy will not be fully revealed until 2023, which will be announced at the end of January 4. the fact that quarterly earnings results are always the strongest results of the year also supports it. Therefore, the recession may not be apparent until April 2023, when the earnings for the first quarter of 2023 are announced.
A CryptoQuant-approved analyst noted that the 2-Year-10-Year yield curve is at its highest level since the 2000s. This dot.com a development similar to his case. Over the past 2 cycles, this has caused a correction of about 50% in the S&P 500. According to the expert, there is a similar situation in the period of Coivd-19. If this happens, it will be the first time Bitcoin will be tested in the process of a real recession. Surviving in such an environment will allow BTC to exist forever as an investable macro asset. However, due to both the risk of recession and the decline in stocks, the BTC price will continue to fall.
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