Hi everyone ! I hope that your day is going well. In this article we’re going to talk about Bitcoin and what can make the bullrun start.
The Boredom
If you have looked at the crypto market in the recent weeks or even months you know that the price of Bitcoin has not moved a lot. In fact it has ranged between 27 000$ and 31 000$ since april !
This lack of volatility can be see through the Bitcoin Volatility Index on tradingview :
As you can see, we are in the lower part of the canal, which means that in the coming weeks we can expect volatility to return to the market.
But what news can end this period of lateralisation ?
Update :
The price have fall down, the volatility is back !
BTC ETFspot
The first event that comes to mind is the approval of BTC ETFs by the SEC, especially the one filed by BlackRock, which in my opinion has the highest chances of being accepted due to BlackRock’s significant financial influence.
Source : livecoins.com
Furthermore, according to internal information at BlackRock, the company will do everything to obtain SEC approval and they are confident that their application will be accepted before the BTC halving in May 2024.
Moreover, if one of the ETFs is approved, there is no doubt that the others will all be accepted.
However, there are reasons that suggest it won’t be that simple. For instance, a few days ago, a former SEC chairman stated that a BTC ETFspot would not be approved due to various reasons.
The main concern being that the SEC has always believed that BTC ETFs could be easily manipulated, causing harm to investors.
However, he also explained that the upcoming presidential elections in 2024 could change the situation.
According to him, if a Republican were to be elected, the SEC might place less emphasis on heavy cryptocurrency regulation, unlike the Democrats if one of their own were elected (except for Robert F. Kennedy Jr but that’s an other story) see the whole tweet here.
The Fed Pivot
One of the other reason that can make BTC go out of this boring trend is the decision of the FED to decrease their interest rate.
To keep it very short, if the interest rate is low, more liquidity can pump into the economy thus insuring a bull market cycle for the stockmarket and also for crypto.
This was one reasons I am very bullish in BTC for the coming month as I said in this article. However the FED has since then raise their rate to 5,5% :
It means that the start of the rate cut may be for Q1 of 2024. However, this can even be delayed due to the uncertainty of the US inflation and the economic situation of China. In short, the Chinese central bank is decreasing their interest rate since the covid outbreak in order to revitalise the economy :
However the it doesn’t work enough because their economy have enter deflation (price going down) which means that the chinese don’t want to spend their money thus the price of living falling.
Conclusion :
The price of crypto will be heavily impacted by the SEC answer for the ETF BTC and the FED directive of their interest rate. However the Chinese economy might reserve us a surprise.
Update :
At the time I’ve finish my article, BTC is down by 12% in 30 days due to the macro-economic pressure and the bankruptcy of Evergrande the real estate giant from China.
The coming weeks are going to be rough.
As always thank you for reading !
Disclaimer : This is not a financial advice, you need to do your own research !
Thumbnail source : Unslapsh
