O Bitcoin (BTC) is heading into one of its best weeks since its historical maximum. The beginning of the expressive increases took place after the announcement that the Federal Reserve – Central Bank of United States – I would go increase the interest rate by 0.75%.
The market was scared of a bigger upside, the relief brought valuations to the tech stock market and consequently to that of crypto assets.
After the announcement of the actual increase, Fed Chairman Jerome Powell’s speech followed a course of pacification of the people, saying the Fed would not take such drastic action and that deterring the economy would be a “soft landing”. .
This speech has led to a further rise in quotations in the risk asset market – and crypto has not been ruled out.
Cryptocurrencies continue to rise in a week with the release of the US interest rate and GDP, notes Iara Thamires Alves, cryptocurrency specialist, MBA in business management and founder of Desvendando. cryptocurrencies.
Rising interest rates are generally very negative for risky assets globally, as they directly impact the investor’s decision to return to fixed income securities, as they become more attractive, with better yields.
However, on Wednesday, there was the announcement of a 0.75% increase in the US interest rate and the markets reacted well.
“The reason for the positive reaction is that this increase was already expected and normally the market already anticipates and prices before the announcement. The market, since it was already priced in advance and cautious with a possible rate increase at the above 0.75% breathed a sigh of relief and we had significant appreciation, closing the day on the positive,” says Thamires.
US GDP fell 0.9% in the second half, beating expectations for the period.
Expectations of a 0.5% decline initially impacted prices, but the rally was virtually instantaneous and maintained the upward momentum, reaching over US$24,000.
“Controversial behavior, because this hike means a temporary recession, which should have scared off the markets, but did not. Arguably, with negative GDP, the Fed won’t have to raise the interest rate so much when of the next meeting to encourage and stimulate the economy, so that justifies the behavior of the market,” he explains.
But Thamires warns that the scenario is still a fragile macroeconomic situation. “Investors should be careful, the war should not stop, the monkeypox virus, the recession”, he adds.
“There are a lot of negative aspects to consider. So in my opinion this appreciation will not be sustainable, I think we will have a correction to US$20,000 to look for support and price consolidation so that only later there will be new highs above 25 US$000.
Prospects for the next few days
Lucas Passarini, Trader at Bitcoin Market, claims that the cryptocurrency can rise further to near $28,000.
“So from 27.5 or 28 we can see that Bitcoin is really losing some strength. The same case applies to ETH, but it is already reaching resistance levels,” he explains.
In recent days, Bitcoin has performed better than the Ethereum (ETH) and Ether has already reached the resistance level which it considers support in May, the analyst explains.
“But it still has some updates to make, a factor that can impact investors’ outlook,” he says.
“For August or for Bitcoin’s bullish pattern to follow, you’ll have to look for $28,000, $28,500 which would give an upside from where we are right now, Bitcoin could go up around 19% or 20%,” he says.
More volatility is expected, the most relevant market data will start coming out in August, as the next Fed interest rate meeting is in September and from there, according to news to be released, this could have an impact on the mood of investors.
“Bitcoin had a very interesting performance in July and everything indicates that in the short term, speaking of 15 to 20 days, we will see Bitcoin continue its uptrend. Ether, on the other hand, has less of a chance, just looking at the chart, as it is in a resistance region, which we have seen in the past being defended by the buyers, so now there may be a defense by the sellers.
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