BEARISH CASE: BTC seems to be forming a downchannel since it topped out last Mar2022 at 48240. This week BTC is trying very hard to get above last week’s close of 20552. If it fails this week to close above the 20k to 22k zone, then we may see lower prices coming.
The FED will testify in congress & Senate this Tuesday & Wednesday, so we expect a lot of volatility coming this week. Resistance is at 22k & support at 18k. If capitulation happens, the 13k to 12k zone is still on the table.
BULLISH CASE: a capitulation this week may signal the bottom for indices & BTC especially if the US10Y yield & inflation (commodity prices) continue to retrace. A very big factor will be crude oil which is the driver of economy. The FED could only control the short end of the yield curve by raising interest rates to increase borrowing cost, slow down economy & create demand destruction. However, it cannot control the supply side of inflation. So if crude continues downward, inflation will definitely subside & the FED may be less hawkish. Right now, a 75 basis point rate hike for July & probably a 100 point hike for September are already priced in by the market participants. So a “not so bad news” will already be good news for the market.
Not trading advice
The FED will testify in congress & Senate this Tuesday & Wednesday, so we expect a lot of volatility coming this week. Resistance is at 22k & support at 18k. If capitulation happens, the 13k to 12k zone is still on the table.
BULLISH CASE: a capitulation this week may signal the bottom for indices & BTC especially if the US10Y yield & inflation (commodity prices) continue to retrace. A very big factor will be crude oil which is the driver of economy. The FED could only control the short end of the yield curve by raising interest rates to increase borrowing cost, slow down economy & create demand destruction. However, it cannot control the supply side of inflation. So if crude continues downward, inflation will definitely subside & the FED may be less hawkish. Right now, a 75 basis point rate hike for July & probably a 100 point hike for September are already priced in by the market participants. So a “not so bad news” will already be good news for the market.
Not trading advice