Although Bitcoin (BTC) touched the $70,000 level again yesterday, this visit did not last long. The initial positivity regarding the rapid price increase to $70,000 was therefore quickly reversed.
But what exactly caused this chaos in the Bitcoin market? At the time of writing, the value of BTC is approximately $67,400.
The roller coaster that the Bitcoin price ended up in yesterday had everything to do with American economic figures and the subsequent comments from Jerome Powell, the chairman of the Federal Reserve.
Initially, markets reacted positively to good inflation figures. Inflation turned out to be lower than expected. Partly as a result, the Bitcoin price rose by almost 4 percent to $70,000 within a few hours yesterday.
However, risk assets could only enjoy this news for a short time. Jerome Powell then made the markets happy with a dead sparrow. He hinted that the Federal Reserve is not thinking about lowering interest rates in the short term.
While several interest rate drops were expected at the beginning of this year, these have not yet materialized. After Powell’s comment, expectations for interest rate cuts in September also fell. It is currently expected that interest rates will be lower in September than the current 56.7 percent.
What will Bitcoin do?
What does this mean for the Bitcoin price? The Bitcoin price has been in a relatively narrow price channel between $66,000 and $71,500 for almost a month.
The former all-time high of 2021, the level of $69,000, remains the level that BTC must break with conviction to continue its journey to new all-time highs.
According to a Bitcoin analyst on X it is important that BTC does not create a lower ‘low’. This would happen when BTC dips below the $66,000 level. A positive sign would be when Bitcoin creates a strong support level above $69,000. Until then, Bitcoin will continue to fluctuate in the price channel described earlier.
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Source: https://newsbit.nl/bitcoin-koers-schommelt-hevig-na-amerikaanse-economische-cijfers/
