KickEX traders analyzed the main events of the past week on the cryptocurrency market and gave a forecast for the BTC exchange rate for the new period.
The main event of the week was the Federal Reserve's announcement of the size of the interest rate increase. Many expected the Fed to raise it by 1%, as rising inflation rates require more aggressive action. However, a step of 0.75% suggests that inflation is assessed as the lesser of all possible evils. Moreover, in November the Fed will stop raising rates, and in 2023 will return to the QE program (purchasing assets and expanding its balance sheet). Such a soft position by the regulator is good news for risky assets.
If containment measures are insufficient, inflation will go galloping and the risk of recession will increase. The control point will be the release of inflation statistics for July-August. Joe Biden does not call two consecutive declines in quarterly GDP a sign of a recession, but uses an academic definition for this. (who will say before the elections that we are already in a recession).
If you look at the Bitcoin chart, then, despite the bad macro statistics, we have good signs of growth:
Next week we predict the following scenarios for the development of events.
Scenario 1: movement to the levels of 25,000 and 29,000;
Scenario 2: correction to 22,500 and subsequent movement to 25,000.
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“By the end of summer we will get out of the range of $22,400 - 17,600” - KickEX analysts
According to the latest report, the US inflation rate for June is currently 9.1%. This has only happened 12 times in the country over the past 110 years. Previous rate increases of 0.75% did not have an effect, so now with a probability of 82% an increase is expected immediately by 1% to a range of 2.5% - 2.75%, which is an extremely negative factor for the growth of the main asset.
Price analysis of Bitcoin, Ethereum, XRP on 07/10/2021
Buyers are stuck in the area of average prices and cannot yet continue their recovery, and at the end of the current week there is a high probability of a resumption of the bearish onslaught.
