Due to the shaky macroeconomic conditions, the price of Bitcoin is undergoing strong fluctuations. BTC broke above $ 22,100 before dropping slightly below $ 22,000 again. The largest cryptocurrency has risen nearly 10% in the past 7 days.
Leading Bitcoin influencer and trader James of Invest Answers believes BTC has crossed the critical resistance area of $ 21,750 and will aim for the $ 24,000 price range. However, experts also warn against a rapid pump-and-dump as macroeconomic conditions are currently uncertain.
What is affecting the price of bitcoin
Macroeconomic conditions are causing the cryptocurrency market to fluctuate. After nearly breaking the $ 22,200 mark, Bitcoin’s price fell below $ 21,800. Consumer Price Index data for August will be released tomorrow. These data are expected to significantly influence the Fed’s decision on the next interest rate hike.
The Fed should continue its hawkish stance of quantitative tightening to fight inflation. Fed Chairman Jerome Powell believes the Fed will want to quickly bring inflation below 2%. The central bank doesn’t want soaring inflation to become the norm in consumers’ minds. St. Louis Fed Chairman James Bullard reveals that he supports another 75bp interest rate hike.
Minneapolis Fed Chairman Neel Kashkari and Cleveland Fed Chairman Loretta Mester have both advocated an aggressive stance against inflation. The CME Fed Watch Tool now shows a 90% probability of a 75 bps increase. The Fed is unlikely to rotate from its hawkish stance after September. According to Mester, the Fed will have to raise the interest rate above 400 bps to fight inflation. The current target rate is 225-250 bps.
Other key events to watch
The CPI date will be released on September 13th. However, it’s not the only key event this week. The CPI for the UK and the Eurozone will also be released. In addition, the PPI, another key inflation index, will also be released for the United States.
The content presented may include the author’s personal opinion and is subject to market conditions. Do your market research before investing in cryptocurrencies. The author or publication assumes no responsibility for your personal financial loss.