Bitcoin (BTC) fell below $21,000 for the first time in eight days on July 26 as Wall Street braced for a decision on US anti-inflation policy.
Fed reluctant to test market resolution
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD ending a period of sideways action on Wall Street’s open, hitting a low of $20,788 on Bitstamp.
Against its highs of $24,280 on July 20, the pair was now down more than 14% as nerves across risk assets intensified ahead of the Federal Reserve’s interest rate decision. due July 27.
The higher the base rate hike by the Fed, the more problematic the outlook for crypto investors, as a tightening would mean more conservative conditions across the economy.
“BTC lost the Higher Low, which represented a shorter technical uptrend,” he said. Told Twitter followers next to an illustrative chart.
Elsewhere on the macro front, the International Monetary Fund (IMF) released its July 2022 World Economic Outlook, forecasting a significant slowdown in global growth, which is expected to average 3.2% this year and 2.9 % in 2023.
“The risk of recession is particularly significant in 2023, when in several economies growth is expected to bottom out, household savings accumulated during the pandemic will have declined, and even small shocks could stall economies,” reads- we.
“For example, according to the latest forecast, the United States will experience real GDP growth of only 0.6% in the fourth quarter of 2023 on an annual basis, which will make it increasingly difficult to avoid a recession.”
Looking at the daily timeframes, popular trader and analyst Rekt Capital warned that with the Fed event still to come, Bitcoin has already lost its uptrend.
“BTC lost the Higher Low, which represented a shorter technical uptrend,” he said. Told Daily Twitter followers.
“The trend has changed.”
Another article described the current pullback as the logical continuation of Bitcoin abandoning its 200-week moving average level as support after briefly regaining it last week.
—Rekt Capital (@rektcapital) July 26, 2022
“Patience is a virtue”, fellow trader and analyst Anbessa continued.
“Wait for a reversal pattern to return. No setup for an entry at $21.6k, so we remain patient.”
Anbessa further stated that there is “no need for FOMO” in the markets at current prices.
Still in line for $1 million?
Others had reason to be cautiously bullish on Bitcoin, with conviction rising based on the timeframes seen.
Related: 3 Signs Bitcoin Price Is Forming a Potential “Macro Bottom”
“Volatile week is going as planned,” another IncomeSharks Twitter account said. continued. In a more optimistic forecast, IncomeSharks said it would see a price of $30,000 “in a few months.”
“Now is not the time to go bearish and sell, that was last week,” he added.
PlanB, the creator of Stock-to-Flow Bitcoin price models, meanwhile argued that BTC/USD could still trade as low as $1 million by 2027.
At the same time, he predicted on the day, U.S. stocks would soar to new highs never seen before.
Some of you are scared of the macro and the link between bitcoin and stock markets etc.
IMO the next 5 years the S&P500 will be between $5,000 and $6,000 and bitcoin between $100,000 and $1M. The short term is the noise, the long term is the signal. pic.twitter.com/rhz4cigHRc
— PlanB (@100billionUSD) July 26, 2022
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