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Bitcoin fell 1% on Monday ahead of US inflation data.
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One crypto analyst expects inflation data and the Fed meeting to affect bitcoin.
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Bitcoin does not have a directional bias and can move in any direction.
Bitcoin (BTC/USD) was trading down more than 1% on Monday, with the cryptocurrency trading slightly below $17,000. Bitcoin has traded at this level since the beginning of the month. The price has also recovered slightly from $16,000 at the end of November. But should we expect a correction in this price?
Bitcoin’s Limited Gains Perhaps Underscoring That Investors Are Still Cautious About Buying cryptocurrency, This means that a large number expect bitcoin to decline further as the risk-on sentiment remains. Similarly, the buyers are defending the $16,000 level. But as this bull-bear scenario unfolds, one popular crypto analyst expects two macro events to further crush BTC. Analyst Nicholas Merton says markets are warming up for the US inflation report and the Fed’s last meeting of the year.
The US inflation report comes on December 12, followed by the Fed meeting on December 14. Higher than expected inflation is likely to fuel speculation of a policy tightening by the Federal Reserve. Already 80% of the market expects the Fed to hike rates by 50 basis points, the analyst says. If inflation heats up, this will lead to faster growth.
Even if the Fed doesn’t hike rates quickly, Merton says markets will still remain under pressure. Analysts say the backward effect of past policy actions could be long-lasting.
BTC marginally up amid weak momentum
On the technical front, BTC traded in a narrow range. The long-term momentum is bearish, although the cryptocurrency has recovered slightly above $16,000. The next resistance for BTC lies at $19,000, while support lies at $14,000.
Will BTC go up or down?
means a limited upside bitcoin price If the macro factors are not positive then the trade may go lower. Investors will be watching inflation reports and Fed actions to see where BTC will go next.
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