Bitcoin (BTC) makes an unexpected surge to the north just a day before the Federal Reserve intends to announce its first rate hike in four years.
Bitcoin is now trading 5% up aboveĀ $41,000 at the time of publication. Bitcoin has now climbed back above $40,000 for the third time in three weeks.
Retail investors, however, should not be fooled by this increased optimism. BTC has crossed over its 20-day EMA and 50-day moving average with today’s move. But make no mistake: the world’s largest cryptocurrency is still well below its 200-day moving average (DMA) of $48,622. Only by crossing these levels will we be able to confirm some signs of an uptrend.
With U.S. inflation rates reaching a four-decade high, the current global macroeconomic situation appears to be rather fragile. The geopolitical instability surrounding the Russia-Ukraine conflict, on the other hand, has aggravated the problems. AĀ Twitter account run by Glassnode co-founders explains:
Liquidation sizes decrease as BitcoinĀ is squeezed into the $38-$42k price range (B). Long liquidations continue to dominate. The next big move is confirmed once we break the $36-$45k range (A).
Don’t Expect Bitcoin to Rally ‘Aggressively,’ Says Mike Novogratz
Mike Novogratz, a billionaire crypto investor and the creator of Galaxy Digital, believes that Bitcoin’s chances of rallying ‘aggressively’ are slim, given the Fed’s plans to raise interest rates and implement severe quantitative tightening measures.
The Fed is reportedly planning four minimum rate hikes this year, with as could go as highĀ as 7-8 hikes possible if inflation does not stabilize quickly. Bitcoin, according to Novogratz, will remain at the $30,000 to $50,000 level this year. He further added:
āI donāt think Bitcoin can rally aggressively until we get a pause. Bitcoin is a narrative story, itās bringing people into the community. Itās hard to bring in new people when their house is on fire.ā
New York State, according to Novogratz, needs to do rid of BitLicense, which makes it extremely difficult for other crypto companies to do business in the state.
