Bitcoin Is About To Have “The Biggest Week Of The Year”

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Disclaimer : The “Industry Talk” section features the views of crypto industry players and is not part of the editorial content of Cryptonews.com.

Bitcoin remains in a negative spiral and has been trading sideways since the fall of FTX. The crypto-asset is not showing much enthusiasm to break out of the range it has been trading in for some time now. In addition, while the current trend continues, BTC miners are still encountering more difficulties.

Nevertheless, analysts are confident about bitcoin’s ability to recover. The price of BTC should be influenced by 5 things over the next few days.

Expected consumer price index directions

The first factor that can influence the price of Bitcoin is the consumer price index. In the United States, it is the tool that makes it possible to measure price inflation every month. Everyone is impatiently awaiting the conclusions of the next publication which will take place on December 13th. Analysts predict that a santa claus rally could take place during the last two weeks of 2022 following this publication.

This report is therefore of significant interest to the Crypto market. In addition, the Federal Reserve will decide on the rate hike at the same time, which implies possible changes depending on the announcements made by its president Jerome Powell in his traditional speech.

The week promises to be eventful, as noted by Material Indicators. The analysis company thinks thatwe should be attentive to the CPI report which will be released on Tuesday and the rise in rates as well as the speech of the present from the FED which will be released on Wednesday.

Other observers also believe that these events will change the course of the market. MisterSpread think it’s probably the most important week of the year. According to QCP Capital, the next CPI report will be the biggest ever as the market has been in a rally for 2 months. So there is no doubt that the CPI can influence market volatility. According the FedWatch tool from CME Group, it is highly likely that the Fed will decide on a 50 basis point interest rate hike.

Fed Target Rate Probability Chart. Source: CME Group

The price of BTC does not change much

The BTC/USD exchange is literally influenced by macroeconomic events of the last days. It is trading in a range around $17,000 as shown by data from TradingView and Cointelegraph Markets Pro. So there is not a big change on the price trend of the BTC/USD pair.

Some analysts were more pessimistic about Bitcoin’s near-term future. For instance, Profit Blue indicated that BTC will continue its descent to $10,000 before the start of 2023.

The US dollar could rise further

Trader Bluntz thinks that Bitcoin could once again start a bearish trend at the end of the year. Because, the US dollar is expected to gain strength in the coming days.

In effect, the US dollar index (DXY) recorded high lows on daily time frames the last days. This bodes a possible renewed strength of the dollar which would be a major problem for the crypto sector because of the inverse correlation.

Supply shock ratio nears 10-year high

Bitcoin is not totally on the verge of going down and there are still a few signs that prove that it could rise again. According to the Illiquid Supply Shock Ratio (ISSR) metric, the Bitcoin is likely to rebound anytime from the supply shock.

This metric measures the amount of BTC supply versus demand in a given time. After the evaluation of last December 10, theISSR was 3.557. This is its highest ratio since August 2014.

Bitcoin illiquid supply shock ratio (ISSR) chart. Source: Glassnode

Arthur Hayes plays down the impact of BTC sales by miners

Former BitMEX CEO Arthur Hayes has commented news around the importance of Bitcoin miners and their impact on the industry. According to him, the bitcoin community shouldn’t fear increased miner sales of BTC which could potentially flood the market with liquidity.

Hayes thinks that “even if miners sold all the bitcoin they produced every day, it would have virtually no impact on the markets“. The reason is that the market easily absorbs this type of selling pressure because it is not the first time it has happened.

In fact, he thinks most BTC sales by miners and centralized lending companies have already been completed. If there was still talk of selling his BTC tokens, it would have already happened. On the contrary, sales are slowing down if the data from Glassnode is to be believed.

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