© Reuters
Investing.com – Like most assets, the stock fell on Tuesday as the better-than-expected US CPI further pushed back expectations for a Fed rate cut.
Indeed, the now indicates an almost zero probability of a rate cut for the FOMC meeting in March, and less than 50% for the following meeting in May.
As a result, the dollar took off, and the stock markets fell, with the technology index notably ending the session down 1.8%, while the US posted its worst decline since March.
However, Bitcoin, and the crypto market in general, showed surprising resistance in the face of this bad news, falling only 0.8% over the last 24 hours, and maintaining a gain of 15.7% over one week.
Why did Bitcoin not plunge in the face of the unpleasant US CPI surprise?
However, this good performance can be explained by the fact that Bitcoin is currently benefiting from other bullish factors which protect it from too strong a decline. In particular, the spot Bitcoin ETFs approved in the USA a little over a month ago continue to be very successful with massive inflows of funds.
In this regard, analysts from AllianceBernstein highlighted in a note published Monday that these ETFs ideally position Bitcoin for its next rally.
“We believe bitcoin’s best days are ahead, and that the ETF-based bitcoin market is poised for what we expect to be a FOMO rally,” the analysts wrote.
They indeed stressed that the market had quickly integrated the new ETFs as soon as they were approved, but that it had not yet taken into account the level of inflow of ETFs or the tightening of supply which will result from the halving of the bitcoin.
New historical records in sight for BTC this year thanks to halving?
Let us remember that the next Bitcoin halving will take place in April. Halvings are technical events scheduled approximately every 4 years, and which consist of halving the reward for Bitcoin miners.
As a result, the growth in supply is slowed down, which mechanically impacts the price upwards, a phenomenon which has been verified during all previous halvings.
In the two years before and after bitcoin’s debut, in 2012, the price rose about 30,000 percent, Mr. Rhodes says. In 2016, the increase was almost 800% over this two-year period. For the last halving, which took place in 2020, investors recorded a gain of 700%.
However, with Bitcoin which is now much more easily accessible thanks to ETFs, everything suggests that the next halving will also allow Bitcoin to pass a milestone, and mark new historical records.
Finally, from a graphical point of view, we note that the major psychological threshold zone of $50,000 tested on Monday and Tuesday remains a key obstacle, while on the downside, $49,000 and $48,000 are the first potential supports.
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