Bitcoin
Can Increased Odds of a Recession Cause Crypto to Rise? – Blockchain News, Opinion, TV and Jobs
Published
2 years agoon
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adminBy Marcus Sotiriou, Analyst at the publicly listed digital asset broker GlobalBlock (TSXV:BLOK).
After a painful week for the stock market in the U.S., the S&P 500 had its best day since July, growing by 2.59%. S&P 500 futures are also up over 1.8%. This has led Bitcoin to rise over 4% overnight. This rise in the stock market was a result of weak manufacturing data that came in yesterday. The U.S. September manufacturing ISM was weaker than the expected 52 and dropped by 1.9pts to 50.9. Furthermore, employment & new orders fell below 50. Prices paid dropped by 1.9pts to 50.9 in addition to supplier deliveries and order backlogs falling These indicators are pointing to less inflation pressure, hence resulting in positive sentiment in global markets yesterday, including Bitcoin.
This does raise the concern, however, that the Federal Reserve could overtighten. Famous investor, and one of Wall Street’s most respected minds, Stan Druckenmiller, said last week, “I will be stunned if we don’t have a recession in ‘23. I don’t know the timing but certainly by the end of ‘23. I will not be surprised if it’s not larger than the so-called average garden variety. I don’t rule out something really bad.” The United Nations calls on the Fed and other central banks to halt interest rate increases, due to fears of extreme tightening conditions causing a global recession.
Based on the last two major stock market drawdowns, shown above by ecoinometrics, we could expect further downside for the stock market if a recession does occur. The dotcom bubble and Great Recession took many months to reach their ultimate bottom and markets took years to recover. However, the fact that the U.S. stock market rallied yesterday after weaker manufacturing data showed that the market is currently fearing persistently high inflation over the danger of a recession. This means that a wider relief rally could be on the cards in the coming months if we continue to see similar data this month regarding slowing inflation.
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Bitcoin
Bitcoin and Other Cryptos Set To Begin ‘Slow Grind Higher,’ Says Arthur Hayes – Here Are His Top Altcoin Picks
Published
1 hour agoon
May 4, 2024By
adminBitMEX co-founder Arthur Hayes is saying that crypto assets are likely to benefit from the US monetary policy going forward.
In a new essay, Hayes says that the U.S. Treasury and the Federal Reserve are engaging in “stealth money printing policies.”
According to the BitMEX co-founder, the “slow addition of billions of dollars of liquidity each month will dampen negative price movement” for crypto assets.
“While I don’t expect crypto to fully realize the recent US monetary announcements’ inflationary nature immediately, I expect prices to bottom, chop, and begin a slow grind higher.”
Hayes says that the recent fall in the prices of crypto assets has offered an excellent opportunity to accumulate.
“I’m buying Solana and doggie coins (memecoins) for momentum trading positions. For longer-term sh*tcoin positions, I’m upping my allocations in Pendle and will identify other tokens that are ‘on sale.’
I will use the rest of May to increase my exposure. And then it’s time to set it, forget it, and wait for the market to appreciate the inflationary nature of the recent US monetary policy announcements.”
The BitMEX founder is an advisor and investor in Pendle (PENDLE), a decentralized finance crypto project that lets users tokenize and sell future yields.
On his Bitcoin (BTC) forecast between now and August, Hayes says,
“A rally to above $60,000 and then range-bound price action between $60,000 and $70,000 until August.”
Bitcoin is trading at $62,726 at time of writing.
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Bitcoin
Crypto Expert Turns Bullish On Bitcoin, Predicts Quantitative Easing Will Begin Soon
Published
13 hours agoon
May 3, 2024By
adminCrypto expert Michaël van de Poppe has made a bullish case for Bitcoin as he alluded to macroeconomic factors that could soon play out in the flagship crypto’s favor. In line with this, he urged Bitcoin investors to take action with a parabolic surge on the horizon.
An Imminent Quantitative Easing Would Be Good For Bitcoin
Van de Poppe suggested in an X (formerly Twitter) post that Bitcoin will rise on the back of a Quantitative Easing (QE), which he anticipates is “close.” He noted that the Fed has already started to “unwind Treasury buybacks and is reducing QT [Quantitative Tightening].” He claims this is happening because the economic data has worsened, which puts the US at risk of a recession.
Therefore, the Fed seeks to avoid this recession by buying back long-term government bonds and injecting liquidity into the financial system. As the crypto expert predicts, this could be good since it will force the Fed to take a more dovish stance and possibly lower interest rates, boosting investors’ confidence to go all in on risk assets like Bitcoin.
Van de Popper further predicts that this Quantitative Easing will become evident in the data released in the coming months. In line with this, he advised investors to long Bitcoin. It is worth noting that Bitcoin dropped to as low as $57,000 ahead of the latest FOMC meeting, with many investors seeming to have anticipated a hawkish stance from the Fed.
However, as the crypto expert noted, the rates remain unchanged, and Fed Chair Jerome Powell raised the possibility of a rate cut as early as June. Given Bitcoin’s price recovery since then, this development looks to have already revived a bullish sentiment among investors.
What To Expect Going Forward
In another X post, Van de Popper revealed his expectations for the crypto market going forward. He stated that Bitcoin will consolidate and go sideways (possibly ahead of the QE which will boost its price in the coming months. Meanwhile, he also expects Altcoins to “heavily outperform and rotation kicks in.”
The crypto expert had previously echoed a similar sentiment when he stated that he expects altcoins to bounce in their Bitcoin pairs while Bitcoin faces a period of consolidation that he doesn’t expect to change in the “coming months.”
Back then, he also mentioned that there would be a narrative shift to Ethereum, and he reaffirmed this belief in a more recent X post, stating that he expects a lot from the second-largest crypto token by market cap.
At the time of writing, Bitcoin is trading at around $59,100, up over 2% in the last 24 hours, according to data from CoinMarketCap.
BTC bulls reclaim control of price | Source: BTCUSD on Tradingview.com
Featured image from Seu Dinheiro, chart from Tradingview.com
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
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Bitcoin
$120 Million Futures Liquidated As Price Takes A Beating
Published
21 hours agoon
May 3, 2024By
adminThe recent dip in the price of Bitcoin below the $59,000 support level has sent jitters through the cryptocurrency market. While the price drop triggered liquidations in futures markets, analysts warn that a more significant decline could be on the horizon in the absence of a full-blown market capitulation.
Measured Retreat, Not Mass Exodus
Following the price drop, CryptoQuant, a cryptocurrency analysis platform, reported roughly $120 million in liquidated long positions (bets that the price would go up). This liquidation is noteworthy, but unlike previous selloffs at the same support level, it doesn’t signal a panicked exodus from investors. Investors seem to be taking a more measured approach, suggesting a possible short-term correction rather than a long-term bear market.
$BTC Futures Market Not Yet Signaling Capitulation
“Given the relatively small amount of long position liquidation and the lack of dramatic negative funding ratios, we believe that a ‘capitulation’ has not yet occurred in the futures market.” – By @MAC_D46035
Link 👇… pic.twitter.com/xqArLQiITf
— CryptoQuant.com (@cryptoquant_com) May 2, 2024
A Glimmer Of Hope For Long-Term Investors
While the short-term outlook appears cautious, there are reasons for long-term investors to remain optimistic. On-chain metrics, which analyze data directly on the Bitcoin blockchain, offer hints of a potential future upswing.
Metrics like MVRV (Market Value to Realized Value) suggest there’s a chance for an upward move in the larger market cycle. This information empowers strategic investors to view the current situation as a potential buying opportunity, particularly if a significant capitulation event unfolds in the futures market.
Bitcoin price action in the last week. Source: Coingecko
Navigating The Bitcoin Maze: Data-Driven Decisions Are Key
The current market volatility presents a complex challenge for investors. Understanding market sentiment is crucial for making informed decisions. The funding rate, an indicator of sentiment in futures contracts, has dipped into negative territory at times.
BTCUSD trading at $59,167 on the daily chart: TradingView.com
Traditionally, this suggests a stronger presence of bears (investors betting on a price decline) than bulls. However, the negativity hasn’t reached the extremes witnessed during past significant downturns, leaving the overall sentiment somewhat unclear.
Bitcoin’s Long-Term Narrative Remains Unwritten
Closely monitoring futures markets for signs of capitulation, along with analyzing other market indicators like the funding rate, is essential for success in this dynamic environment. Sharp investors armed with a strategic understanding of market dynamics are likely to profit from any future moves.
Bitcoin’s recent price drop has caused short-term volatility, but the long-term story remains unwritten. While the coming weeks might test investor resolve, those who can analyze market data and make strategic decisions could be well-positioned to capitalize on future opportunities.
Featured image from Pixabay, chart from TradingView
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
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