The year of the dollar? The markets are in the red and are plunged into uncertainty. Despite analyzes that place the floor price of bitcoin (BTC) above $ 40,000, it is mostly time for questions rather than claims.
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FED balance sheet reduction: a red year for bitcoin?
Bitcoin drops to $ 42,487 on Bitfinex today, January 6, 2022. It is trading at $ 43,212 at the time of writing, and is currently recording a daily loss of 1.69%.
The collapse in the price of bitcoin coincides with the publication on January 5, 2022, of the minutes of the US Federal Reserve decision-makers meeting in December 2021. The minutes thus indicate the will of certain directors to ” reduce the size of the Federal Reserve’s balance sheet relatively quickly after starting to raise the fed funds rate ”.
Markets therefore expect that the Fed raises its interest rates in March 2022, this reduction in the Federal Reserve’s balance sheet could then begin before this summer.
The $ 46,000 to confirm a floor price for bitcoin?
Trader Michaël van de Poppe shared in his tweet today, a scenario of a bitcoin finding support around $ 41,665 to bounce back and resume the upward path. The other scenario would be according to him, “a rapid recovery above $ 46K”.
Using an analogy with the structure of the markets during the bearish corrections from May to June 2021 before the price of bitcoin subsequently rebounds, Michaël van de Poppe estimates that a recovery of $ 46,000 would mean that bitcoin has hit its floor price :
“The question is, are we going to stay here, take the cash and go back above $ 46,000?” In this case, the floor is reached. “
For trader Rekt Capital, bitcoin is looking support around $ 43,440 – the green diagonal in the graph below.
Bears continue to dance in the markets at the start of 2022, benefiting in particular from the support of the US Federal Reserve. The scenario of a $ 40,000 test despite oversold markets on a daily basis should not be ruled out.
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