Popular analyst Michaël van de Poppe warns that the Fed’s rate hikes will not save the US from recession and risk assets will suffer. The analyst says that Bitcoin (BTC) could face a retest of $20,000.
“US possibly going into a recession”
Amid confusion over how incoming US macroeconomic data could affect market sentiment, Michaël Van de Poppe says the recovery seen in cryptocurrencies and equities this year is more likely to show a bearish bias. Bitcoin, for example, saw a 40% increase in January, but like others, he believes a disappointing February is a real possibility.
About the longer-term status quo, he says, “I think people need to understand that it’s not a soft landing, this downtrend in the markets is likely to continue.” Van de Poppe suggests the US will “probably go through a recession” thanks to the extent of the Federal Reserve’s rate hikes.
He also states that if a drop for Bitcoin starts to manifest itself, a potential retest target is between $20,000 and $21,000. Much depends on the outcome of the January Consumer Price Index (CPI) data, which will be released on February 14. If it shows that inflation is slowing less than expected or even disrupting this downtrend, the results could benefit the US dollar and dampen the headwinds on the risky asset rally.
cryptocoin.com As you follow, the US Dollar Index (DXY) has dropped 13% since mid-2022, when it hit its highest level in two decades. Currently, DXY is in a consolidation process. Van de Poppe comments:
In that case, the next week will likely lead to a rally of the dollar or the next week with CPI and PPI. That’s why it’s so important to keep an eye on this chart.
US Dollar Index (DXY) 1-day candlestick chart / Source: TradingViewBitcoin bears are “squeezed in cash”
Meanwhile, others are discussing the potential for Bitcoin price pullback ahead of a less important macroeconomic week. Popular analyst Crypto Tony argues that the bear market remains in play, suggesting that a higher low would provide a better entry point for longs. In this context, the analyst makes the following statement:
This could be the start of a bull market. Moreover, personally, I am still not in this camp. On a pullback to a higher low you can still get a safer entry.
That said, some familiar bull voices are as active as ever, including crypto and market education, analysis and forecasting tool IncomeSharks. “People seem confused about why it’s just going up,” he sums up in a tweet on Feb. Meanwhile, hours before the close of the week, Bitcoin is trading at $22,883 at the time of writing. IncomeSharks also comments:
Just remember that most of the bulls are still holding and not selling. Bears are stuck for money. Slowly but surely the bears give up and buy. The stubborn ones continue to short sell to push the price higher.
BTC 1-day chart / Source: CoinMarketCap
