Will Bitcoin Enter Danger Zone When Fed Rate Decision Is Coming?

On March 17, the macroeconomics newspaper The Kobeissi Letter reported, “It's official Fid Week, the week we've all been waiting for.

The U.S. central bank will deliver its highly anticipated announcement on March 20, setting the stage for the U.S. economy to move forward.

Key events this week:

1. Housing information begins – Tuesday

2. Fed interest rate decision – Wednesday

3. Federal press conference – Wednesday

4. Philly Fed Manufacturing Index – Thursday

5. Existing home sales data – Thursday

6. Chairman of the Federation Paul speaks – Friday

Officially registered…

— Kobeissi Letter (@KobeissiLetter) March 17, 2024

Something that does not seem to cut the level

According to data from the Chicago Mercantile Exchange, the probability that the Fed will leave interest rates unchanged is as high as 99 percent.

For the first time this year, markets will see only three interest rate cuts in 2024, Kobeisi reported, this week the odds of a rate cut were below 2 percent, and the odds of a cut in May fell to around 7 percent. %

Markets three months ago had expected as many as seven rate cuts by 2024, before adding:

“As inflation data starts to pick up again, three rate cuts are becoming more optimistic.”

US interest rates are currently at 5.5%, the target from July 2023 as the central bank grapples with inflation.

In addition to the United States, Australia, the United Kingdom, Japan and other countries will announce interest rate decisions this week, so market volatility is expected.

Has Bitcoin entered the danger zone?

After the launch of ETFs in the US, the Bitcoin and crypto markets were dominated by institutional interest. However, as daily ETF returns begin to fall, this enthusiasm may wane as the halving approaches.

On March 17, crypto trader and analyst ‘Rekt Capital' wrote that Bitcoin would officially enter the “danger zone” this week, as historic pre-halving corrections began.

Historically, BTC has done these exercises in the two to four weeks before halving. In the year In 2020, this rebound was -20% deeper, and in 2016, it was -40% deeper again, he said.

#BTC

In 3 days, Bitcoin will officially enter the “danger zone” (orange) where the historic pre-halving corrections have begun.

Historically, Bitcoin has done pre-halving retracements 14-28 days before it splits.

In the year By 2020, this rebound was -20% deeper.

In the year In 2016, this retraces -40%… pic.twitter.com/t0EHA6bpWY

— Rekt Capital (@rektcapital) March 16, 2024

BTC has fallen 7.7% from its March 14 high of $73,738 and was trading at $68,600 at the time of writing.