Home News Will Bitcoin See A Valentine’s Day Massacre Or Can Bulls Get Back To $24,000?

Will Bitcoin See A Valentine’s Day Massacre Or Can Bulls Get Back To $24,000?

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Will Bitcoin See A Valentine’s Day Massacre Or Can Bulls Get Back To $24,000?

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The price of Bitcoin has returned to sideways action following a massive rally from its yearly lows at around $16,400. The cryptocurrency has been trending to the upside on favorable macroeconomic winds, but uncertainty remains king and could hinder any bullish momentum.

Bitcoin Vs. Pow-Pow, A Bull-Run In The Making

As of this writing, the price of Bitcoin is hovering around the $23,000 level as the market holds its breath for an upcoming interview with the U.S. Federal Reserve (Fed) Chairman Jerome Powell. The interview will come out today and could provide insight into the financial institution’s assessment of the current situation.

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BTC’s price moved sideways on the daily chart following a profit period. Source: BTCUSDT Tradingview

The crypto market and risk-on assets, such as stocks, have been trending to the downside since 2022 because the Fed has been hiking interest rates to slow down inflation. Now, the market believes the financial institution will pivot its monetary policy.

Market participants expect Powell and the Fed to shift course to prevent the U.S. economy from entering a recession. Recent inflation data suggests the metric is trending to the downside. These two factors are behind the recent Bitcoin and crypto rally.

Last week, during the Fed’s Federal Open Market Committee (FOMC), the Fed Chair was expected to come out “hawkish,” emphasizing its view that the market must see “pain,” as he did in December 2022. However, Powell gave the market more leeway and hinted at slowing down the Fed interest rate hike.

According to a report from the trading desk QCP Capital, during today’s interview, Powell could “shake things up.” If the Fed gives a hawkish statement to counterbalance last week’s FOMC, the market could see some downside volatility.

Today’s sideways price action reflects the high expectations from market participants. On a positive note, Powell’s statement could provide some clarity. QCP Capital noted:

Hopefully tomorrow’s interview will clear things up for everyone – especially his view on financial conditions, and whether he thinks this rally has gotten out of hand. (…) it seems inflation had indeed fallen quicker than what the FOMC forecasted in Dec, as compared to our expectation that it was in-line with their projections.

In addition, Bitcoin investors should keep an eye on the upcoming Consumer Price Index (CPI) print, a proxy to gauge inflation. If the metrics come out higher than expected, any BTC bullish momentum could be capped in the short term. The trading desk added:

Post Powell, all eyes will quickly move to CPI on 14 Feb, barring any unforeseen outliers in this Friday’s inflation expectations number. Will we see a Valentine’s Day massacre or a redemption off another weak print?

QCP Capital believes U.S. unemployment should climb above 4%, along with a low CPI, to see the Fed pivot its policy in 2023. Otherwise, the financial institution will continue bringing more pain to Bitcoin investors.

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