Bitcoin (BTC) reached its historic maximum (ATH) of $124,500 on August 13th. However, he couldn’t stay at those levels, and the price fell below $113,000.
After falling to $112,900, Bitcoin shows a slight recovery and is currently negotiated for $113,300below the highest record of under 8.7%.
So, what’s going on with the price of Bitcoin?
The first thing to say is that Focused on the Jackson Hole Economic SymposiumIt will be held from August 21st to 23rd. The meeting will bring together central bankers, finance ministers, economists and investors, but will have a key time with Jerome Powell’s US Federal Reserve president’s speech scheduled for Friday.
The head of the agency responsible for defining monetary policy in the country speaks in the midst of the bet that the Fed will score 25 basic points, currently in the range of 4.25% to 4.50%.
But despite these expectations, everything shows Powell again It gives a moderate speech without great ads, without committing to cuts of future feats And emphasizes the autonomy of the Fed.
This most cautious tone cools down investor optimism and cultivates the sense of bassists in the market.
One sample was that a week ago, CME Group FedWatch Tool announced interest rate cuts in September assigning a 94.3% chance. Seven days later, that figure will fall to 85.1% and could continue to decline after Powell’s speech.
The fact that interest rates have a major impact on financial markets, including Bitcoin and cryptocurrency, as explained in Cryptootics. This will result in higher borrowing costs and lower system liquidity.
Aside from what happens on Friday, It is important to emphasize that the bullish perspective on currency prices created by Nakamoto at continues. Among the reasons is that more and more companies are using BTC into their financial assets.
Additionally, BTC has outstanding performance from Stock Range (ETF) funds. Last week, these financial products won over $880 million.
In this regard, professional trader and market analyst Willie Wu pointed out that a decline of more than $10,000 from ATH was due to liquidation. In the futures market, when prices move against leveraged positions, exchanges automatically close these operations to avoid greater losses.
For analysts, the market is “too speculative” – meaning that there is an excess of leveraged positions betting on rapid climbs, returning to prices far more vulnerable to sudden corrections.
However, there are indications that prices could begin to recover in the short term. In this regard, Wu states: “The real question is, what are investors doing? Risk risk signal (Macro Cycle Risk) It’s down, indicating that investors’ liquidity is back. If the trend continues, BTC is a great way to continue. ”
The MCR (red line) is a risk in the macroeconomic cycle and is an indicator that models the liquidity of the BTC market to identify entry and exit points for the upward cycle.
If the MCR indicator decreases as is now, it means that more fluidity is in the system. Historically, each fall in the MCR has anticipated a strong upward movement for Bitcoin, with the recent price drop turning into an opportunity for many investors to acquire BTC at a lower level.
