Bitcoin (BTC) fell below $21,000 for the first time in eight days on July 26 as Wall Street prepared to make a decision on US anti-inflationary policy.

Hourly candlestick chart BTC/USD (Bitstamp). Source: Trading View

Fed nervous as it tests market resolve

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Data from Cryptooshala Markets Pro and trade view showed BTC/USD ended a period of sideways movement at the Wall Street open, hitting a low of $20,788 on Bitstamp.

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From a high of $24,280 on July 20, the pair is down more than 14% as nervousness about risky assets intensified ahead of the Federal Reserve’s interest rate decision due on July 27.

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The higher the Fed’s base rate hike, the more problematic the outlook for crypto investors will be, as more tightening will mean more conservative conditions prevailing in the economy.

“BTC lost a higher low, which represented a lower timeframe technical uptrend,” he said. said Twitter followers next to an illustrative chart.

As for macroeconomic indicators, the International Monetary Fund (IMF) published a report for July 2022. World Economic Outlookpredicting a significant slowdown in global growth, which should average 3.2% this year and 2.9% in 2023.

“The risk of a recession is especially pronounced in 2023, when growth is expected to bottom out in a number of countries, household savings accumulated during the pandemic will decline, and even small shocks could bring the economy to a standstill,” the document says.

“For example, according to the latest projections, real U.S. GDP growth in the fourth quarter of 2023 will be only 0.6% year-on-year, making recession avoidance an increasingly difficult task.”

Looking at the daily timeframes, popular trader and analyst Rekt Capital warned that with the Fed event yet to come, Bitcoin has already lost its uptrend.

“BTC lost a higher low, which represented a lower timeframe technical uptrend,” he said. said Twitter followers that day.

“The trend has changed.”

The following post describes the current pullback as a logical extension of Bitcoin abandoning its 200-week moving average as support after bouncing back briefly last week.

“Patience is a virtue,” said fellow trader and analyst Anbessa. continuation.

“Wait for re-entry of the reversal pattern. No entry setup at $21.6k, so we remain patient.”

Anbessa also said there was “no need for FOMO” in the markets at current prices.

Still in line for a million dollars?

Others had reason to be cautiously optimistic about bitcoin and their conviction grew in line with observed time frames.

3 signs that the price of bitcoin is forming a potential “macro bottom”

“The volatile week is going as expected,” a fellow IncomeSharks account tweeted. continuation. In a more bullish outlook, IncomeSharks said it would expect a price of $30,000 “in a few months”.

“Now is not the time to get bearish and sell, that was last week,” he added.

Meanwhile, PlanB, the creator of Bitcoin Stock-to-Flow price models, has argued that BTC/USD could still trade at $1 million by 2027.

At the same time, as he predicted on the same day, US stocks will hit never-before-seen highs.

The views and opinions expressed here are solely those of the author and do not necessarily reflect those of Cryptooshala.com. Every investment and trading step involves risk, you should do your own research when making a decision.