Bitcoin holders consider the asset a hedge against inflation, keeping an eye on the Federal Reserve’s response to rising inflation. The increase in US consumer prices is the fastest since 1982, fueling concerns at the Federal Reserve.
US consumer prices soared 7.5%, growing at the fastest pace in 40 years. The spike increased pressure on the Federal Reserve to tighten policy.
The Federal Reserve’s response to economic conditions could impact investor sentiment toward Bitcoin and crypto. Though the core Consumer Price Index (CPI) noted a 0.6% increase, the same pace as December 2021, there was a material increase in inflation.
With a limited supply, investors consider Bitcoin a hedge against inflation. Inflation has acted as a driver for extended gains in Bitcoin, as investors flock to BTC during times of uncertainty.
Analysts expect the Federal Reserve to aggressively raise interest rates, higher than previous forecasts. In a recent meeting, the Federal Reserve hinted at interest rate hikes starting in March 2022.
Proponents believe the recovery in the cryptocurrency market and Bitcoin price over the past two weeks was fueled by the Federal Reserve’s response to rising inflation. Though the idea that Bitcoin acts as a hedge against inflation is criticized for being theoretical, Scott Bauer, CEO of Prosper Trading Academy, believes that it could have partially contributed to the BTC price rally.
@FeraSY1, a crypto analyst and trader, believes if Bitcoin price sustains above $38,758, $49,000 could be the next target. The analyst noted a bearish divergence on the 4-hour candle, looking for an Inverse Head-and-Shoulders formation, predicting a subsequent rise after a bearish trend.
I don't like the combination of last few 4H candles, alongside with bearish div. on 4h
I will be looking for iH&S formation, with a strong condition that #BTC should NOT close any 4H candle below 38758$
if the iH&S got validated, 49K zone will be the target$btc https://t.co/2f20q2kzvW pic.twitter.com/pDMw1YCPj9
FXStreet analysts have predicted that Bitcoin price could stumble while the asset targets $50,000.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Cardano price has been on a downswing for the past month and has revisited a crucial support level twice in this range. A breakdown of this barrier could lead to a steep correction to levels last seen a year ago. Cardano price set up a higher high at $1.64.
XRP price could be headed lower as sentiment fails to shift bullish, putting Ripple at risk of a 10% fall toward $0.70. The prevailing chart pattern suggests that the cross-border remittance token could continue to consolidate.
Bitcoin price dropped below a critical Ichimoku level on Thursday and extended the drop throughout Friday and Saturday. However, this pullback is probably due to a return to equilibrium within the Ichimoku Kinko Hyo system.
MATIC price has been on a downtrend since December 27, 2021, and has shown no signs of a reversal so far. The recent uptrend, albeit promising for a while, failed to set up a higher high.
Bitcoin price is at an inflection point of its recent uptrend and is likely to reverse and establish a directional bias. If BTC sets a higher low, there is a good chance the rally will continue; else, investors can expect a steep correction.
Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts.
Opinions expressed at FXStreet are those of the individual authors and do not necessarily represent the opinion of FXStreet or its management. FXStreet has not verified the accuracy or basis-in-fact of any claim or statement made by any independent author: errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website, by FXStreet, its employees, partners or contributors, is provided as general market commentary and does not constitute investment advice. FXStreet will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.