Bitcoin has been pretty boring for quite a long time, with the same pattern repeating itself over and over again. One week we go up, and the following week we go the other way. It’s a typical ranging pattern, and it will have to break sooner or later. In this article, I’m going to share my scenario for the coming days.
Bitcoin Situation
The king of crypto has been in a clear channel since its last All-Time High (ATH) last March, going from 73k to 49k at the lowest. It’s important to note that it’s only a -33% fall.
We’ve already seen retracements like this during previous bull runs, so there’s no need for people to spread FUD about a possible bear market happening soon.
I like to see this as a second chance for people who want to reorganize their portfolios, especially with altcoins that saw strong corrections, though I won’t mention them in this article because I believe Bitcoin is the one leading the direction of this market.
The interesting thing I’ve noticed is a gap that has formed at 54k (Right Circle) on the Bitcoin CME, where institutions trade Bitcoin, similar to the New York Stock Exchange.
What is a Gap ?
A gap occurs when the price of a crypto or stock jumps significantly between two trading sessions, with no trading happening in between. This creates a gap between the previous day’s closing price and the next day’s opening price.
Gaps happen due to high volatility. The important thing to know is that, most of the time, gaps need to be “filled,” meaning the price goes back to where it was formed (see the 2 left circles).
This is a high probability but not always the case , we can never be 100% sure.
US Federal Reserve (FED)
This Wednesday (18th), the US Federal Reserve will update its interest rates, which will be a very important day for risk-on assets like crypto. Right now, the interest rates are at 5.25%–5.50% :
Source : TradingEconomics
It’s almost certain that a rate cut will happen, but the question is whether it will be 0.25% or 0.50%.
Source : CME Group
As you can see, this is the probability that the market is currently expecting. Most investors believe we’ll see a 0.50% rate cut, but there’s still a lot of uncertainty, so we can expect high volatility !
As always thank you for reading !
My favorite Crypto Faucet : Cointiply (referral)
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Disclaimer : This is not a financial advice, you need to do your own research !
My Opinion About the Crypto Market Right Now was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this story.