Bitcoin (BTC) Crashes Under $19,000 With Fed Rate Hike on the Radar
The world’s largest cryptocurrency Bitcoin (BTC) has faced major price correction once again. In the last 24 hours, the BTC price has crashed under $19,000 moving closer to its 2022-low of $17,500.
As of press time, Bitcoin is trading 6.0% down at $18,711 with a market cap of $358 billion. This takes Bitcoin’s weekly losses to more than 15% now.
The latest price correction in Bitcoin comes on the backdrop of the uncertain macro environment. The higher-than-expected inflation at 8.3% for the last month has once again dented the sentiment of the bulls.
Ahead this week, the U.S. Federal Reserve will supposedly announce an interest rate hike. Currently, the market is predicting for a 75 basis points rate hike, however, noting that the inflation has been higher than it previous month, a 100 basis points rate hike cannot be ruled out.
Mike McGlone, senior commodity strategist at Bloomberg Intelligence, said: “The Fed will not be easing any time soon, and it’s classic human nature because now we have the benefit of knowing how far in the mistakes they made by easing too much. Risk asset growth since the March 2020 crash had swung way too far to one side, and it is now “very clear” that a reversal will take hold”.
However, McGlone is bullish that Bitcoin will ultimately perform well in the overall market reset. He also believes that even Gold will outperform, however, both assets will face some pain before that.
For now, Bitcoin’s immediate support on the downside will be the June-2022-low of $17,500. On the upside, $20,000 will act as a major resistance. In the Bitcoin derivatives market, BTC shorts have been stacking up hinting at the downside pressure.
Along with Bitcoin, the broader cryptocurrency market has also entered a major correction. Along with Bitcoin, the overall crypto market has tanked 6% moving closer all the way to $900 billion.
Also, the euphoria around Ethereum Merge has ultimately ended that has now turned into a sell-the-news event. ETH has tanked more than 25% on the weekly chart and nearly 9% in the last 24 hours. As of press time, ETH is trading at $1,319 with a market cap of $160 billion.
All of the other top-ten altcoins have also entered similar correction. The U.S. equity market will be the key to watch out here and shall serve as a leading indicator for crypto price movements going ahead.