Dim forecasts indicate a collapse of cryptocurrencies to these levels By Investing.com

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Investing.com – Recently battered by higher-than-expected US inflation data, it has so far failed to recover from the setback. Ahead of the Fed’s interest rate decision on Wednesday, Bitcoin came under fresh pressure.

{{news-2320978||urgent| A sharp decline in the adoption of digital currencies as a means of payment .. and there are positives}}

Interest and cryptocurrency

The market priced another rate hike of 0.75%, but it can’t be ruled out that a hike to 1.0% as well. This latest price hasn’t happened in 40 years and will hit the markets hard. Given that, riskier assets like this also react negatively to the upcoming event.

In addition, investors are increasingly adjusting to the fact that monetary policy easing is not expected any time soon. Bloomberg analyst Mike McGlone said:

“The Fed is not going to ease anytime soon. It’s a typical human reaction to its wrong decisions, now we have the advantage of knowing how many mistakes the Fed made while easing monetary policy excessively.”

Goldman Sachs (NYSE:) had previously expected to raise interest rates by 0.5% and 0.25% in September and November. Meanwhile, these forecasts have been changed under the supervision of Jan Hatzius so that the interest rate is now assumed to rise by 0.75% and 0.5%.

Bitcoin options that expire at the end of the year reveal that most traders are betting on BTC dropping to the 10,000-12,000 range.

This scenario coincides with the assessment of Sharon Bell, an analyst at Goldman Sachs. She thinks stock markets could drop another 26% if the Federal Reserve becomes more aggressive in fighting inflation.

Bitcoin technical levels

Bitcoin price is down -7.80% in the past 24 hours to $18,491 while the total weekly loss is -16.62%.

The 78.6% Fib retracement support level of $19,251 was broken, opening the way for a test of the session low at $17,630. The RSI hasn’t reached the oversold territory yet, so the downside momentum can expand immediately.

Short-term losses can only be prevented if the bulls manage to sustainably overcome the 78.6% Fibonacci retracement resistance level. Above this level, focus will then shift to the psychological $20,000 level and the 61.8% Fibonacci retracement at $20,523.

The article is in Arabic

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