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Technicals and Macro Picture Suggest Bitcoin is Setting up for a Bounce – Blockchain News, Opinion, TV and Jobs

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Technicals and Macro Picture Suggest Bitcoin is Setting up for a Bounce – Blockchain News, Opinion, TV and Jobs

Bitcoin climbed back above $40,000 last night, as it formed a bullish divergence on the 4-hour time frame, whilst exiting the oversold region. This is a bullish set up and has a high percentage outcome of leading to a significant bounce. In addition, Bitcoin closed the day yesterday inside the channel that has lasted around 100 days, after trading below for some time. This is another bullish indicator as the wick formed shows buyers stepping in, causing a ‘fake-out’ of the pivotal channel.

In terms of bullish technical analysis, the macro landscape is looking positive in my opinion, which is a different outlook to the majority. As core PPI released last week was almost double the expected rate, many have become more fearful of a 50-basis point rate hike, and therefore increasing the chance of a slowing economy.

However, I am not concerned whether there is a 50-basis point rate hike or not. What matters is how strong the consumer is. The University of Michigan consumer sentiment index is flat, showing that we do not have unanchored inflation expectations, meaning that people do not think inflation is going to run away. This was not the case in the 1970s, which led to a recession.

Furthermore, core CPI is decelerating as used cars are falling in price – we are seeing a rotation away from goods to services. This is additionally proven by retail travel increasing and Delta Airline guiding higher.

Despite many funds and economists predicting a recession, the facts suggest we may have a soft landing. Therefore, I think the short term is bullish for Bitcoin and equities, even if there is a 50-basis point rate hike or not.





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Mr Bitcointe
Mr Bitcointehttps://www.bitcointe.com/
“Fact You Need To Know About Cryptocurrency - The first Bitcoin purchase was for pizza.” ― Mohsin Jameel
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