2023/03/21 (195.058) Technical Analysis

BTC1! Reached The Price Target Of 27365$, On Monday
– I Except Further Price Increases, That`s Why A New 4XSetUp This Week

Elon Musk, Peter Schiff and Bill Ackman warn the US Federal Reserve against a rate hike

The US Federal Reserve, Treasury Department and FDIC are exploring a possible guarantee for all bank deposits in the US. This would allow the FDIC to temporarily insure deposits in excess of the current $250,000 limit for most accounts without having to seek approval from the US Congress. As the banking crisis continues despite the efforts of the US government and regulators, a total of $18 trillion in deposits would be guaranteed if the crisis spreads. The FDIC, the Fed and the Treasury Department have already given assurances that taxpayers will not foot the bill for this crisis. While authorities don’t think the move is necessary as they believe the banking sector is safe, First Republic Bank, which plunged 47% on Monday, signaled efforts must be made to prevent contagion from spreading. Billionaire Bill Ackman took to Twitter to share his concerns about the deepening banking crisis ahead of the FOMC meeting. He thinks the Fed should take a break after three US banks closed in a week and Credit Suisse went under.

Tesla CEO Elon Musk responded to Bill Ackman saying “The Fed needs to cut interest rates by at least 50 basis points on Wednesday.”
He also believes the FDIC needs to raise the current limit of $250,000 to prevent bank runs. Musk and several other crypto influencers last year warned the Fed about raising interest rates to increase recession risk. The economist Peter Schiff also blamed the US Federal Reserve and the FDIC for the current banking crisis in the US. He believes banks were doing well before the FDIC and that inflation will destroy the value of all bank deposits, saying that “$18 trillion in deposits are insured by $100 billion in government bonds.”

Bitcoin price remains strong near $28k

Bitcoin price is currently trading at $27,600 and is down more than 2% in the last 24 hours as investors await the Fed’s rate hike decision. BTC price is very likely to hit $30,000 if the Fed decides to pause Wednesday’s rate hike amid banking woes. According to the CME FedWatch Tool, there is a 25.5% chance of the Fed not raising rates and a 74.5% chance of a 25 basis point hike.The Fed Is Not The Problem! The FED is the solution…
Even if I stand alone with this opinion more often than I would like! But this is politics…

Because the FED’s restrictive rate hike cycle is the logically consistent reaction to the US Democrats’ expansionary US fiscal policy, which had previously gotten out of hand, under the watch of Joe Biden. Because the left-wing green economic policy, under the cloak of a liberal democracy, has driven prices up and fueled them so much that the Fed now has to put out the inflation fire, in the function of the fire brigade! Even if half of all Americans don’t like to read it because they last voted for the US Democrats. But that’s politics – as already written. As was the economic policy under Trump until the outbreak of the corona virus.

However, let`s get an overview about 10Y Yields price action on this monday,
because the fixed income securities are the historical counterpart of the BITCOIN!
And the BITCOIN Future only makes sense on financial narkets because of low interest rates! Or?

Government bond yields in Europe moved higher, with the benchmark 10-year Bund yield trading around 2.27%, after falling to as low as 1.92% on Monday as investors’ risk appetite returned as authorities increased efforts to restore confidence in the banking sector. Over the weekend, the Swiss government forced a takeover of Credit Suisse by UBS, and global central banks’ moved to boost dollar liquidity. Also, ECB President Christine Lagarde reiterated Sunday the European Central Bank remains ready to support euro zone banks with loans if needed, although the euro area banking sector is resilient, with strong capital and liquidity positions.

The yield on the Italian 10-year BTP rebounded to above 4.2% from the six-week low of 4% touched on March 20th, as stability in the global banking sector was momentarily restored and limited demand for safe-haven government bonds. Besides easing concerns of a crisis, reassurance in the European financial sector add to the tightening leeway for the European Central Bank. The ECB raised its key rates by 50bps this month, as previously pledged, but recent volatility kept the central bank from hinting at another interest rate hike in its next meeting or announcing a faster pace for quantitative tightening after the second quarter. Consequently, the spread between the 10-year BTP and its German counterpart narrowed to 175bps after reaching a two-month high of 192bps on March 15th.

The yield on the French 10-year OAT rebounded to 2.8% from the six-week low of 2.67% on March 20th, as concerns over vulnerability in the global banking sector eased and supported investors’ appetite for riskier assets. Bets that the European Central Bank would have more leeway to tighten financial conditions due to more stable lenders’ positions also lifted government bond yields. The ECB raised its benchmark interest rates by 50bps in its March meeting, in line with its previous pledge to extend the fight against soaring inflation. On the fiscal side, the French government pushed through plans to increase the legal pension age by 2 years to 64 without a vote in the National Assembly after the Senate approved the motion. While the move eased fiscal concerns and supported French debt, the legislation brought significant political instability to the National Assembly, with President Marcon’s government narrowly surviving a no-confidence vote. Further protests are expected.

The yield on the US 10-year Treasury rose to above 3.55%, moving further away from a six-month low of 3.291% hit on Monday as markets calmed down and banking crisis fears eased for now. Treasury Secretary Janet Yellen said that the government is ready to provide further guarantees of deposits if the banking crisis worsens. Also, the collapse of Credit Suisse appears to have been avoided, after the Swiss government engineered a forced takeover by UBS, although AT1 bonds worth $17 billion, are set to be wiped out. Meanwhile, the focus turns to the FOMC 2-day meeting, with the central bank set to raise the fed funds rate by 25bps on Wednesday.

The yield on the Swiss 10-year government bond approached the 1.1% mark, rebounding from the four-month low of 0.97% touched on March 17th as worries over a global banking crisis eased, reducing demand for the safety of government bonds. The Swiss government engineered UBS’s takeover of Credit Suisse to prevent systemic risks after the latter’s imminent failure, raising hopes for a much-needed reset in the troubled sector. Despite the banks’ turmoil, the Swiss National Bank is broadly expected to hike its key policy rate by 50bps this week for the second consecutive decision to extend its fight against high consumer prices. Inflation in Switzerland unexpectedly rose to 3.4% in February, overshooting market expectations of 3.1% and SNB forecasts of 3%. Previously, SNB authorities stated it was necessary to continue monetary tightening to prevent secondary inflation effects from entrenching.

Regardless of my personal opinion, the current expectations are
that emerges from the market (i.e. the majority of financial market participants) is not new!
I expect the Fed to hike your rate by 25bp – and then maybe another one!? And/or can`t imagine reate cuts 2023 yet…

The reluctance of market participants around this serious event can mostly be observed and with good reason. While at most central bank meetings one has a pretty good idea of what is going to happen in advance, that is not the case this time and so pre-meeting trading is even more constrained than usual. For the crypto market, that means one in the last 24 hours Down 2.88% to a total value of all coins in circulation of $1.147 trillion. While a clear direction will not be given until tomorrow after the Fed’s announcement, tomorrow’s price increase is guaranteed for C+Charge (CCHG).

Bitcoin is currently trading around $27,665, stabilizing at a high level, but has fallen 2.25% in the last 24 hours. On a weekly basis, this still results in an increase of more than 13% and the Bitcoin dominance is also at an extremely high value compared to the last few months at 46.4%. This means that Bitcoin now accounts for almost half of the entire crypto market again. Considering that numerous new coins are launched on a regular basis, it is still a strong achievement to continue to expand the market dominance. This picture emerges above all in uncertain times, when the motto of many investors is: “If crypto, then Bitcoin.”Of course, it’s not a bad idea to always go with the market leader in every asset class you’re invested in, because in most cases there’s a reason why they’re in that position. Nevertheless, the development of the digital reserve currency over the next few days can probably only be estimated after tomorrow’s interest rate decision by the Fed. While it was certain until recently that the key interest rate would be raised further, some now suspect that there will be no further increases due to the banking crisis in the USA and even expect that the first interest rate cuts will be announced for the summer.

If that is the case, it would likely be a strong bullish move on the price. In this case, a rise to the $30,000 mark and beyond would be conceivable. Until then, however, further restraint is to be expected, and a drop to below $27,000 is also possible. If the Fed stays on course and continues to raise interest rates despite
the banking crisis, primarily in order to get inflation under control again, a much stronger setback can also be expected, which could fall below the psychologically valuable $ 25,000 mark again.

So be very careful until tomorrow.
There is a reason why numerous investors have already skipped the days before the Fed meeting, even though the decision here has usually been made beforehand. This time there is a lot of uncertainty about the actions of the central bank and so one should not expose one’s capital to unnecessary risk here. Anyone who waits until tomorrow and listens to Jerome Powell’s words can still open their positions during the announcement and take advantage of the strong market movement that is to be expected afterwards and benefit from it if you place yourself accordingly.