If we talk about cryptocurrencies, nothing terrible happened for them at the January meeting of the Fed. It had long been known that the regulator would tighten monetary policy and reduce monetary injections into the economy. As well as the fact that it will raise interest rates. Yes, this will hit risky assets, but it will draw money from the stock market in the first place. It is possible that things will not reach cryptocurrencies, as a super-speculative asset at all: the volumes are too small.
The crypto market grew by leaps and bounds as the Fed flooded the fires of the pandemic with trillions of brand new freshly minted dollars. There will be no more inflow of this money, and it is probably not worth counting on a new crypto boom. Institutional investors will behave much more calmly, but they will not be in a hurry to part with their bitcoins and ethereums either. Everyone who wanted to sell them has already sold. Those who wanted to keep them, kept them as a long-term investment.
Of course, any surprises are possible in this industry: both pleasant and not so much so. In the meantime, the crypto market is recovering from the panic that arose before the Fed meeting. Having fallen on Monday, January 24 to $32.945, the BTC/USD pair grew a little and it is trading in the $37,000 zone on the evening of Friday, January 28 at the moment of writing this. The total market capitalization has risen from $1.51 trillion to $1.70 trillion, and the Crypto Fear & Greed Index has grown to only 24 points (11 points at the low of January 23), being stuck firmly in the Extreme Fear zone. So it is clearly premature to talk confidently even about the beginning of a recovery and a trend reversal. Moreover, the BTC/USD chart shows that the strong support that the pair relied on both in 2020 and 2021 is located in the $29,000-30,000 zone. So there is room to fall.
Recall that Kiyosaki predicted a “giant stock market crash” last October and warned that the same fate awaits gold, silver, and bitcoin. This is exactly what we are seeing now.
According to other market participants, bitcoin can visit the $30,000 area, and then it is likely to turn around. Charles Edwards, the founder of the crypto investment company Capriole, wrote that the signal of the NVT (Network Value to Transaction ratio) indicator shows that BTC is oversold: this situation is rare in the market. “We have entered an open buying zone,” Edwards commented on the current situation.
Recall that this indicator was proposed and is actively used by the well-known analyst Willy Woo. NVT is calculated by dividing bitcoin's market capitalization by its transaction volume (in USD) and is a popular metric to assess whether the coin is overbought or oversold.
Michael Saylor, founder of MicroStrategy, named two reasons for the current correction in the cryptocurrency market. The first of these is the non-transparent regulation and regulatory uncertainty of the crypto industry. The second is the imperfection and immaturity of the crypto industry. At the same time, the businessman believes that the current market conditions provide “an excellent entry point for institutional investors interested in cryptocurrencies, who have been on the sidelines so far.”
According to Saylor, a lot of institutional investors are now watching bitcoin and see that it is 40% below the all-time high and that it is consolidating. At the same time, they understand that bitcoin is supported by such serious investors as Bill Miller, regulators, senators and congressmen, as well as large public companies.
As for MicroStrategy itself, this software developer owns 124,391 BTC. The company has spent about $3.7 billion on the acquisition of cryptocurrency. Thus, the average purchase price is $30,100 per 1 coin. And if it falls below this level, it will result in multi-million or even billions in losses for the owners of MicroStrategy. And now, a couple of soothing statements to conclude the review. The first is from Scott Melker, a trader, analyst and podcast host, who reminded his subscribers that there is nothing unusual about what is happening in the market now. “People have short memories. Bitcoin fell from $60,000 to $30,000 in 10 days in May. 10 DAYS!!! All this has already happened. And that was only 8 months ago. So why be so scared?" he wrote.
The second is from McDonald's fast-food chain, which offered owners of digital assets to get a job in the catering industry during the bearish trend. This is a joke of course. But, as they say, there is some truth in every joke. The McDonald's tweet was liked by the community and quickly gained almost 100,000 likes.
|#||Crypto||Prediction||Accuracy||CVIX||Price||24h||7d||Market Cap||7d price change|
|1||BTC||Bitcoin predictions||72.4%||54||$28 074.88||1.42%||6.75%||$542 595 098 494|
|2||ETH||Ethereum predictions||78.4%||39||$1 789.03||1.69%||3.73%||$218 931 127 624|
|3||USDT||Tether predictions||94.4%||1||$1.000964||-0.12%||-0.14%||$78 561 748 618|
|4||BNB||Binance Coin predictions||72%||51||$322.80||-1.05%||-3.47%||$50 967 622 478|
|5||USDC||USD Coin predictions||93.2%||2||$0.999332||0.02%||-0.05%||$34 397 234 540|
|6||XRP||XRP predictions||88%||21||$0.428007||-3.02%||15.55%||$21 807 340 661|
|7||HEX||HEX predictions||62%||82||$0.099118||-21.02%||13.72%||$17 188 210 128|
|8||ADA||Cardano predictions||77.2%||44||$0.362034||-3.18%||7.81%||$12 570 250 725|
|9||STETH||Lido stETH predictions||95.2%||1||$2 941.39||-0.40%||-3.32%||$10 258 752 564|
|10||DOGE||Dogecoin predictions||74.4%||51||$0.075197||-3.32%||0.49%||$9 976 470 500|
|11||MATIC||Polygon predictions||77.6%||48||$1.11||-0.93%||-6.66%||$9 736 000 748|
|12||SOL||Solana predictions||72.8%||52||$21.64||-0.41%||7.14%||$8 304 203 236|
|13||BUSD||Binance USD predictions||96%||1||$0.999552||-0.04%||-0.16%||$8 060 405 263|
|14||DOT||Polkadot predictions||76.4%||49||$6.15||-0.66%||-3.23%||$7 188 099 699|
|15||LTC||Litecoin predictions||71.2%||59||$91.84||1.13%||11.76%||$6 663 269 575|
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