On Thursday, Bitcoin initiated trading in red, which is down by 0.63% to $27,805, and Ether is down 2.5% to $1,741.
However, the big question on everyone’s mind is, of course, about the interest rates.
In a recent note, David Mericle, Chief Economist at Goldman Sachs, said that the U.S. Federal Reserve will pause hikes on interest rates because of stress adhering to the banking system.
“While policymakers have responded aggressively to shore up the financial system, markets appear to be less than fully convinced that efforts to support small and midsize banks will prove sufficient,” Mericle mentioned in the note.
“We think Fed officials will therefore share our view that stress in the banking system remains the most immediate concern for now,” the note stated further.
Tom Shaughnessy, co-founder of Delphi Digital, says the market is giving off mixed signals. While many say the probability of the Fed pausing interest rate hikes is a bullish signal for bitcoin, in reality it might turn out to be something else entirely.
“The data suggests that once the Fed stops raising or pivots, that’s historically when markets sell off,” Tom said on a recent CoinDesk TV appearance.
“I think the rally is less about the Fed pausing and more about liquidity pressures or surpluses there,” he added.
It is also said that data collected from CryptoQuant might back up Shaughnessy’s telltales. Its Adjusted Output Profit Ratio indicator, which tracks the profitability of HODLers, shows that various investors are selling assets at a profit. In the middle of a bull market, this can signal a market hike.
On the other hand, its Net Unrealized Profit and Loss graph shows that investors are in an anxious phase, with moderate and unrealized gains.
Ultimately, in the end, everyone’s attention will be focused on the Fed’s imminent announcement to determine if it will be bullish or bearish for bitcoin.
- Published By Team Genuine Reporter