Slowdown and retracement – Good news from the US Federal Reserve (FED) gives momentum to the bulls in the very short term. However, on-chain data shows that markets should expect further dips in Bitcoin (BTC) price, below its current lows for this cycle.
Rate cut in sight: Bitcoin price rebounds
Bitcoin price rises to $16,676 on Bitfinex today, November 23, 2022. Cryptocurrency $16,540 is negotiated at the time of writing this article. They are currently seeing a daily gain of 2.51%.
Bitcoin price explodes to $16,500 as talks are held verbally in meetings on the 1uh and November 2, reports from US Federal Reserve officials was released today. The document states that:
“A large majority of the participants played that a slowdown in the pace of the house would probably be in order. »
Theoretically, a decrease in the magnitude of the next interest rate hike should be favorable to risky assets like Bitcoin, at the expense of the greenback. The dollar (DXY) is down since yesterdayas the price of Bitcoin regained $16,000 and has continued to rise ever since.
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FTX and Bitcoin crisis: even more declines for a bottom?
Despite these rises above $16,000, other data suggests that Bitcoin still has no not hit its bottom on this cycle, and that we should therefore expect other more significant declines, below the current lows for the year.
Data from Glassnode shows that Bitcoin is registered reached below 77% Compared to its current ATH when it bottoms out this crypto winter around $15,500 on November 21.
This 77% drop subtracts less than the amount of retracements from Bitcoin’s price floors in previous cycles, even with a larger ratio than others. This figure amounted to 85% and 83% when Bitcoin bottomed in January 2015 and December 2018 respectively.
If the scenes of 2015 and 2018 are repeated by this cycle, the price floor of Bitcoin would then locate it to $10,339, i.e. to $11,717.
So the current rises would be yet another bull trap, before further declines in the price of Bitcoin below its current low for this crypto winter? The markets are closely watching the development of the situation for Genesis, the subsidiary of Group of digital currencies may (or may not) be the cause of the final capitulation that would drive Bitcoin price to the long-awaited bottom.
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