Bitcoin Weekly Review
Between December 5 and 11, the BTC/USDt pair traded in the price range of $16,700 - $17,425. In the first half of the week, bitcoin was under pressure, in the second half it got out to a small plus. Since Bitcoin returned to the connection with the stock and currency markets, it reacted to the dynamics of stock indices and the dollar index.
December 5 (Monday) investors were scared by data from the US services sector, which came out better than expected. The statistics have changed the market sentiment of market participants, as they are still afraid of the continuation of the Fed's tough policy to curb inflation. As a result, the S&P500 index failed to break through the trend line on the daily and weekly time frames. The downward correction intensified against the backdrop of the closing of long positions in the shares of the technology sector. The dollar index recovered to 105.79 points. The BTC/USDt pair returned to the $16867 level.
On December 6 (Tuesday), the bitcoin rate consolidated at $17,000. On December 7 (Wednesday), the BTC/USDt pair fell to the $16678 trend line amid risk aversion. Since December 8 (Thursday) the situation on the markets has changed. The dollar index turned down, the S & P500 index recovered to 3974 points. Bitcoin has risen in price against the US dollar by 2.30%, to $17,224. At these levels, the growth of the index ended, as did the strengthening of bitcoin.
On December 9 (Friday), the S&P500 fell 0.73% to 3934.39 points. The sale of risky assets resumed after the publication of disappointing data on producer prices in the US in November. Prices rose more than expected. The PPI index in November rose by 7.4% in annual terms and by 0.3% compared to October. On average, the growth of the first indicator by 7.2%, the second - by 0.2% was predicted.
Fears of a tightening of monetary policy by the Fed and a possible recession came to the fore. U.S. stock futures reversed from gains to declines, while Treasury bond yields jumped.
Statistics shakes the markets on the eve of the US Federal Reserve meeting, which will be held on December 14th. High volatility is what sellers of options want to sell at a high premium. Investors expect the rate to be raised by 50 basis points on Wednesday to 4.5% per annum. According to the latest data from the CME FedWatch Tool, the probability of a 50bp rate hike is . is 78.2%.
The crypto market remains uncertain. The decline of the BTC/USDt pair on Friday was restrained. The $17,350 level is not passed, but buyers can still pass it until Wednesday. The 4H price pattern is favorable for an up move.
Support is at $16900, the key one is at $16500. We are waiting for the denouement after the speech of the head of the US Federal Reserve, J. Powell, at a press conference, which will take place after the announcement of the decision on rates. High volatility is expected on Tuesday after the publication of data on consumer prices. Markets are waiting for inflation to decrease from 7.7% to 7.3% per annum. If the consumer price index turns out to be higher than expected, then a negative wave will sweep through all risky assets. Powell's speech depends on the latest data.