Bitcoin drops to $27,000; Fed meeting could be decisive on Wednesday By

© Reuters – O is having a tough time this weekend, with the cryptocurrency dropping to a low of $27,253 in the early hours of Sunday (12).

Bitcoin is down 3.84% in 24 hours and 7.78% in one week at the time of writing, at $27,401.9.

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Remember that the pair started to fall last Friday, after the once again exceeded expectations that confirmed that the Federal Reserve (Fed) will continue to raise its interest rates aggressively, a positive factor for the and negative for the Bitcoin.

Bitcoin then lost $30,000 and confirmed its drop on Saturday, dropping below $29,000, before blasting a new psychological threshold, $28,000, on Sunday.

No new crypto-specific news appears to be behind Bitcoin’s accelerated decline over the weekend, and it should be remembered that reduced liquidity in the cryptocurrency market over the weekend tends to accentuate the moves.

However, we note some information from China that does not favor risk appetite in general. Beijing has reintroduced some minor restrictions to control a new wave of Covid-19. Earlier, a city government spokesperson had said that “the recent outbreak … is of a highly explosive and large-scale nature”.

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Important thresholds for Bitcoin in the short term

Anyway, from a chart point of view, the next potential support is the $27,000 threshold, ahead of the 2022 low at $26,600. So few reliable supports can be seen before the main psychological threshold of $20,000.

Finally, remember that after the European Central Bank (ECB) meeting last Thursday and after the US CPI on Friday, the next big event for Bitcoin, and financial markets in general, will be the Thursday’s Fed meeting, for which an interest rate hike of 0.5% is widely anticipated.

However, given last Friday’s unpleasant CPI surprise, more and more voices are talking about the possibility of an even higher rate hike of 0.75%. If this materialized, it would be a strong hawkish surprise that would no doubt see Bitcoin drop very sharply.

By France

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