The leading cryptocurrency Bitcoin (BTC) could bounce back to previous lows as it continues to trade in a tight range. The start of the Bitcoin Miami Conference 2022 could provide some support to the bulls. The event is usually filled with positive announcements that have a direct impact on the price of BTC. However, the macro factors that are preventing Bitcoin and other cryptocurrencies from reaching new heights seem to be gaining importance again. As cryptokoin.com previously reported, the FED may become even more aggressive as high inflation continues.
While macro factors are unfavorable, a new rally in Bitcoin price may start
In the short term, Bitcoin must stay above $44,000 daily to avoid further price losses. Therefore, any short-term selling pressure could cause BTC price to slide lower again. Bloomberg Intelligence Senior Commodity Strategist Mike McGlone said the BI trend metric, which is used to measure market momentum, signals a buy in the long run.
As seen in the chart, the signal has continued with great rebounds in the last 7 years. McGlone said about BTC’s potential to reclaim higher levels:
There have been 30 signals in the last seven years, of which 66 percent profited. While macro factors remain unfavorable and the broader model is still in the wide $30,000-70,000 range, the upcoming rally could be similar to that of the August 2021 rally of 65 percent.
Uptrend dollar signals even more appreciation
The rally in the US dollar, the conflict between Russia and Ukraine and rising inflation in the US seems to be fueling the current downward movement of the Bitcoin price. The dollar, which has been in an uptrend for almost a year, signals even more appreciation as uncertainty in global markets increases and investors try to protect their savings.
FTX Access believes the crypto market is facing a short-term hurdle with the upcoming FED Federal Open Market Committee (FOMC) meeting. As mentioned, the financial institution could get more hawkish by raising interest rates from 25 basis points to 50 basis points. FTX Access also advised investors to monitor the Fed’s balance sheet, saying:
It’s possible that this meeting is too early to agree on a QT plan. But given how far behind inflation they are, it seems quite likely that FOMC officials will guide us that balance sheet easing will be faster than last time
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