Bearish BTC price calls are back after the Federal Reserve destroyed sentiment towards Bitcoin and risk assets.
Bitcoin (BTC) hovers around $102,000 at Wall Street open Dec. 19 as crypto sentiment cautiously recovers from fresh macro panic. Fed halts Bitcoin bull run
Data from Cointelegraph Markets Pro shows that BTC prices are up 2% compared to the daily opening price.
The day before, Bitcoin joined the sell-off in cryptocurrencies and risk assets at the hands of the Federal Reserve, during which BTC/USD fell to a low of $98,695 on Bitstamp.
The pressure comes from Federal Reserve Chairman Jerome Powell, who expressed reluctance to cut rates in the future amidst various inflation indicators rebounding.
“With today's actions, we have lowered the policy interest rate by a full percentage point from its peak, and our policy stance is now clearly less restrictive,” he said in a prepared statement during a press conference, which announced a 0.25% cut in the benchmark rate.
“Therefore, when we consider further adjustments to our policy interest rate, we can be more cautious.”
As a result, both the S&P 500 and the Nasdaq 100 indices closed down about 3% during the trading session of the day.
Nevertheless, the latest estimates from the CME FedWatch Tool indicate that the probability of the Fed further cutting rates at the next meeting in January is only 8.6%.
When analyzing the BTC price movements in lower time frames, popular trader Skew remains moderately optimistic about Bitcoin's recovery.
“So far, even after experiencing last week's lows and market demand, there has been no trend failure,” he wrote in a post on X about the 4-hour chart.
“Hoping to see the price here maintain strong momentum above the VAH and for passive demand to persist below the price to recover/higher.”
Skew refers to the Value Area High (VAH), which makes the area above $101,500 worth holding.
BTC Price Risk January Pullback
Others suggest taking a longer-term view amid increased volatility, as Bitcoin still rose 6% in December.
“The movement of $BTC Price is turbulent and does not look pretty. However, it still shows a slow upward trend,” trader Daan Crypto Trades continued in part of his own post on X.
Daan Crypto Trades acknowledges the spillover effect of large-scale liquidations that accompany market downturns. Data from monitoring resource CoinGlass shows that the total amount across cryptocurrencies in the last 24 hours was $800 million as of the time of writing.
“Going back to 2021, Wednesdays were typically days when we saw a lot of liquidations,” he added, discussing market behavior during the last Bitcoin bull market.
“It almost became a trend at some point. Just up -> Midweek liquidation wick -> Pullback. It will be interesting to see if this scenario plays out again.”
Nevertheless, more bearish forecasts come from those who are cautious about macro impacts. Trader and analyst Mark Cullen warned that Bitcoin may still experience a “larger pullback.”
“BTC still holds at 100k, which could see one more push before a larger pullback hits,” he warned his followers on X, predicting that this scenario would unfold in January.
