Bitcoin and Altcoin Prices May Plummet as Top Trader Warns of Fed’s Imminent Mistake
The cryptocurrency market, particularly Bitcoin and Altcoins, may be on the verge of a significant downturn due to a warning from a top trader. According to Sven Henrich, a well-known trader, the Federal Reserve may be about to make a critical mistake in its monetary policy, which could have far-reaching consequences for the market. The warning comes as the price of Bitcoin (BTC) has already crashed to $113,000, its lowest level in over a week, representing an 8.60% decline from its highest point this year.
Top Trader’s Warning: Fed Should Not Cut Interest Rates
Henrich’s warning is based on his analysis of the current economic data, which suggests that the Fed should not reduce interest rates in September. The chances of a rate cut had increased after the release of weak wage and salary account data in the United States, with the polymarket probability remaining over 71% and the CME FedWatch tool at 85%. However, Henrich points out that the core inflation rate has risen to 3.1% in July and is expected to continue to increase, making a rate cut unnecessary.
Henrich’s statement came just days before Jerome Powell’s explanation at the annual Jackson Hole Symposium in Wyoming. Powell had previously stated that the Fed would remain data-dependent in determining interest rates. The latest data shows that the United States may be experiencing stagflation, characterized by high inflation and weak economic growth, leaving the Fed with a difficult decision to make.
Bitcoin Price Chart Shows Risky Pattern
The weekly chart shows that Bitcoin’s price may be on the verge of a sell-off, which could affect Altcoins. A huge rising wedge pattern has formed, with the two lines converging soon. A bearish breakout is likely to occur when this convergence happens. Additionally, the price of Bitcoin has formed a bearish divergence pattern, with the relative strength index and MACD continuing to decline. This could lead to a crash to less than $100,000, resulting in further declines in Altcoins.
BTC price diagram | Source: crypto.news
Implications of a Fed Mistake
A delay in the Fed’s decision to cut interest rates could have significant implications for Bitcoin, Altcoins, and the stock market. The recession risks are high, with some key sectors already experiencing a recession, according to Mark Zandi of Moody’s. The Fed’s decision will be crucial in determining the direction of the market, and a mistake could lead to further declines in cryptocurrency prices.
For more information on the potential impact of the Fed’s decision on Bitcoin and Altcoins, visit https://crypto.news/bitcoin-and-altcoins-may-crash-as-top-trader-issues-fed-warning/
