As the Federal Reserve’s recent decisions continue to impact the cryptocurrency market, we witness the continually fluctuating value of cryptocurrencies like Bitcoin (BTC). A thumb rule in the market—ah, the Bitcoin supremacy—is currently taxed with the burden of a 4% decline over the week. This depreciation in BTC’s value coinciding with the Federal Reserve’s unchanged interest rates and projection of an upcoming increase indicates a subtle shift in the playfield. The consequential bearish face of non-yielding assets like Bitcoin amplifies investors’ quest for apparent ‘safer’ assets like the U.S. dollar.
Seemingly, this shift signifies a correlation between Bitcoin and the U.S. dollar, observed as increasingly inverse. The average correlation coefficient between BTC and the U.S. dollar index, as per the 20-day average, stands at a lowest of -0.73 since September 2022. Nevertheless, the Bitcoin enthusiasts anticipate an upcoming ounce of bullishness with the possible approval of a Bitcoin exchange-traded fund (ETF) by the U.S. Securities and Exchange Commission in the nearing October.
While approval of the first gold ETF in 2003 led to an epic 300% soar in gold prices over the years, will a Bitcoin ETF approval fetch a similar trajectory? A moment of stillness before the storm or the calm after the storm—at 13.39 the Historical Volatility Index of Bitcoin seems to be stuck in the middle. This stagnancy compared to its peak of 190 in February 2018, and Bitcoin market’s least-volatile period, is stirring a whirlwind of speculations within the crypto community.
Detached from the rigorous impact of the hawkish decisions of the Fed, long-term Bitcoin holders remain unfazed, holding on to their positions for over 155 days, strongly expecting a more rewarding Bitcoin price in the future. Short-term holders, the speculators, exhibit a stark shift as they appear to secure profits or accumulate Bitcoin at higher prices. Bitcoin’s fluctuating patterns raise questions over its unwavering dominion—a conflict that remains unaddressed.
However, Bitcoin’s flat trend is perceived as a buying opportunity by crypto analysts, projecting an extended bull run in late 2023 and throughout 2024, catalyzed by mid-2024’s Bitcoin halving. Projections are overwhelming, ranging to a provocative $100,000. Yet, with a potential reverse head-and-shoulder pattern in view, the short-term technicals cast a warning with a bearish target for the BTC price to be around $25,400. Yet, the Bitcoin narratives continue to thrive, providing the crypto market with relentless drama!
Source: Cointelegraph
