Bitcoin (BTC) exceeded the key technical resistance level of $ 11,500 and exceeded $ 11,600 on August 5when a new round of bullish sentiment picked up more than last weekend’s slide.
Market performance for cryptocurrencies from August 5. Source: Coin360
Coin360 data showed that BTC / USD hit a high of $ 11,650 in four days at the time of publication of this report earned more than 4% in the last 24 hours.
BTC / USD daily chart. Source: Coin360
The excitement is still felt by Bitcoin, who spent the week slowly repairing losses after falling from $ 12,000 to $ 1,200 on Sunday.
The Federal Reserve could create a “wildly bullish” environment to seek refuge
Bitcoin could go up if the Federal Reserve of the United States it tries to increase inflation in a movement that “makes no sense”.
In a speech last week, the President of the Fed, Jerome PowellIt turned out that the results of a one-year review, which would determine future policies, could be available as early as next month.
This would mean it, as CNBC reported on August 4th The Federal Reserve would stick to lower interest rates for the year to push inflation to a 2% target.. The annual inflation rate was 0.6% until June 2020.
As a result, recent safe asset highs should continue, with gold, silver, and possibly Bitcoin taking advantage of Federal Reserve action.
Edward Yardeni, President of Yardeni ResearchHe told the publication that a 2% inflation target would mean “continued lower real yields, lower dollars, lower volatility, lower credit spreads and higher stocks”.
It would be “wildly bullish” for both gold and silver, he added.
Bitcoin recently copied the record rise in safe havens. at levels that exceed $ 11,600At the time of publication thanks to a quarterly result of almost 60%.
As Cointelegraph reported on Wednesday Several statistics show an increase in interest and investment in cryptocurrency in the past few months.
Another analyst further warned that shifting to higher inflation would cause more pain to average consumers and face logic.
“It makes no economic sense,” he quoted CNBC Peter Boockvar, Chief Investment Officer of Bleakley Advisory Group.
“The consumer is currently very fragile. The last thing we should aim for is a higher cost of living.”
The VIX trend means that Bitcoin remains “extremely bullish”.
Summarize the plans Gabor Gurbacs, Bitcoin-friendly investment manager strategist VanEck, painted a bleak future for the US dollar and for those who own it.
“The two remaining options for fiat money are either to spend it quickly before it is inflated, or to take it to speculative markets artificially supported by the central bank’s print money.”he wrote on twitter.
“Fiat money is not a saving instrument. The average person doesn’t understand that. “
Another indicator of possible additional gains for Bitcoin this week was the relationship with the VIX volatility index.
As an analyst of Nice new coin, Josh OlszewiczThe decline in the VIX generally means gains for BTC / USD, with the downward trend continuing for several months.
“Historically extremely bullish for BTC,” he tweeted.
BTC / USD chart with VIX volatility. Credit: Josh Olszewicz / Twitter
VIX is derived from the activity of the S P 500, an exchange with Bitcoin has shown a correlation of up to 95% in the past.
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