Bitcoin manipulates speculators
Bitcoin, the largest cryptocurrency, moved in rapid up and down, or the so-called “Bart Simpson” bounce pattern, shattering the hopes of the bulls.
The style, named after Simpson's haircut, forms when a sudden price hike follows a sharp fall.
Earlier in the day, the cryptocurrency jumped to nearly $41,800, printing a huge green candle on the hourly chart.
To the dismay of the bears, an equally large red candle followed shortly thereafter.
At the time of the article's publication, Bitcoin has fallen to the level of $39,700.
Galaxy Digital CEO Mike Novogratz recently predicted that Bitcoin's performance will remain weak in the near future due to market sentiment towards risk.
However, he still believes that the leading cryptocurrency could be worth half a million dollars in the next five years.
On Wednesday, the US Federal Reserve is widely expected to announce its first rate hike in years.
The market appears to have demonstrated a 25 basis point increase, but there is always room for surprises.
If the Fed does not start a tightening cycle on March 16, it will give Bitcoin a significant boost, but such a scenario seems highly unlikely.
In February, banking giant Goldman Sachs predicted that the Federal Reserve would have to raise interest rates seven times in 2022.
The central bank is under tremendous pressure to tame out-of-control inflation, which has recently reached its 40-year peak.
The Fed's aggressive shift to tightening paints a bleak picture for risky assets like technology stocks and bitcoin. Meaning, raising interest rates will not be in favor of Bitcoin.
By @natalia-irish
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