Bitcoin has had one of the calmest weeks, since the FTX collapse. Ever since the largest cryptocurrency by market capitalization fell to the $17,000 level during the market meltdown — Bitcoin continues toying with a comeback to the previous mark of above $20,000.
Since December 8, BTC tested the $17,100 resistance line several times, according to CoinMarketCap. This could indicate that the cryptocurrency could surpass that level and test an even higher resistance zone in the near future.
For now, investors are waiting on the United States Federal Reserve’s new interest raise announcement.
In an FOMC meeting scheduled for November 13 and 14, the Federal Reserve chairman Jerome Powell will announce the new interest rates for the American Economy.
As announced in November, expectations are that the FED will raise by 50 basis points, taking the interest rate to a whopping 4.5 to 5% — the highest rate since 2007.
However, that’s not exactly bad news for cryptocurrency. Previously, the FED has been consistently raising interest rates by 75 basis points. If the 50 points are confirmed, the “slowing down” of the interest rates is bound to generate market optimism for the cryptocurrency sector.
Consumer Price Index Report
The most recent consumer price index inflation rate report for November was 5.88 percent, lower than the 6.33 percent predicted by analysts.
This is the first time this year that the CPI has gone below 6%, which means that the FED’s long-lasting battle against inflation is beginning to show results.
Given the apparent success in controlling inflation, the data from the CPI further corroborates the expectations that the FED will in fact lower the rates of interest raises for December onwards.
Crypto Market Anticipation
The fact that Bitcoin is consistently testing the $17,100 resistance zone indicates that investors are optimistic about the upcoming FOMC meeting. If the expectations about Jerome Powell’s speech turn out to be true, Bitcoin could go through a significant upward trend in the following days.
However, that entire train of thought could collapse if the opposite occurs. In the case that a higher-than-50-points interest raise happens, the much-awaited return to $20,000 will likely be delayed.