A sequence of macro warnings coming out of the Goldman Sachs camp puts Bitcoin (BTC) at risk of crashing to $12,000.
Bitcoin in “bottom phase”?
A team of Goldman Sachs economists led by Jan Hatzius has raised its prediction on the speed of Federal Reserve benchmark rate hikes. They noted that the US central bank would raise rates by 0.75% in September and 0.5% in November, against their previous forecast of 0.5% and 0.25%.respectively.
The path of the Fed’s rate hikes has played a key role in determining how Bitcoin’s price will evolve in 2022. The period of rising interest rates—from near zero to the current 2.25-2.5% range — has prompted investors to rotate out of riskier assets and seek refuge in safer alternatives like cash.
Bitcoin is down almost 60% so far this year and is now teetering around its $20,000 psychological support. Some analysts, including pseudonymous trader Doctor Profit, believe that the price of BTC has entered the bottom phase at current levels. However, the trader warned:
“Please consider the Fed’s upcoming decisions. 0.75% [aumento de tasas] It’s already discounted, 1% and we see blood.”
On the other hand, Bitcoin’s continued positive correlation with the US stock market, particularly the tech-heavy Nasdaq Composite, poses deeper downside risks.
Sharon Bell, a strategist at Goldman Sachs, suggests recent stock market rallies could be bull traps, echoing her firm’s warning that equities could plunge 26% if the Fed gets more aggressive with rate hikes. rates to combat inflation.
Interestingly, the warnings coincide with a recent rise in short positions in Bitcoin by institutional investors, according to CME data highlighted in the Commodity Futures Trading Commission (CFTC) weekly report.
“It’s definitely a sign that some people are counting on a meltdown in risk assets this fall,” said Nick, an analyst at data source Ecoinometrics.
Options consensus sees BTC at $12,000
Bitcoin options expiring at the end of 2022 show that most traders are betting on the BTC price falling to the $10,000-12,000 zone.
Overall, the open interest ratio between calls and puts was 1.90 on September 18, with calls for the $45,000 strike price carrying the most weight. But strike prices between $10,000 and $23,000 showed at least four puts for every three calls, perhaps a more realistic tentative assessment of market sentiment.
From a technical point of view, Bitcoin price could drop by roughly 30% to $13,500 as the price forms a compelling inverse cup and handle pattern.
Conversely, a decisive breakout above the 50-day EMA (the red wave) near $21,250 could invalidate this bearish setup, positioning BTC for a rally to $25,000 as its next move. bullish psychological target.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
Investments in crypto assets are not regulated. They may not be suitable for retail investors and the full amount invested may be lost. The services or products offered are not aimed at or accessible to investors in Spain.
