Imminent “light” recession in the United States?

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Bitcoin price suddenly faced a significant increase in selling pressure following the minutes of the US Federal Open Market Committee (FOMC) meeting in June.

The consensus among officials at the meeting leaned towards maintaining current interest rates, although a few suggested a slight increase of 25 basis points. For the foreseeable future, particularly in 2023, the vast majority of the committee anticipates further escalations in rate hikes.

The biggest cryptocurrency is down 1.1% to $30,500 on Thursday, while the second-largest crypto, Ethereum, has in the past 24 hours lost 1.4% to trade at 1 $913. This pressure is not unique to BTC and ETH, given a 1.2% decline in the total crypto market cap to $1.23 trillion.

Despite the slight decline, Bitcoin price sits comfortably above immediate support at $30,500, with much stronger support expected at $30,000. BTC surged, reclaiming resistance at $31,000 in June, bolstered by multiple filings by companies wanting to offer a spot Bitcoin ETF.

Bitcoin Price Extends Breath as FOMC Dust Settles

Investors will likely spend the next few days digesting the FOMC minutes, especially since “virtually all participants noted in their economic projections that they believe additional increases in the target federal funds rate in 2023 would be appropriate.”

In the meantime, it remains of great importance that Bitcoin maintain its position above $30,000. A confirmed slide below this level would open a Pandora’s box. Remember that market sentiment has improved over the past few weeks, supported by renewed interest from institutional investors like Blackrock and Fidelity Investments.

A slight disruption in improving market sentiment could trigger a sell-off amid widespread discontent among retail investors, who are known to follow the trend.

That said, there is a huge possibility that the Moving Average Convergence Divergence (MACD) indicator will issue a sell signal in the coming sessions – possibly before the weekend.

BTC/USD daily chart | Commercial view

The call to sell BTC would manifest when the MACD line in blue crosses above the signal line in red. A double-top pattern on the same daily chart could increase the chances of Bitcoin falling back below $30,000.

Another bearish signal comes from the Money Flow Index (MFI), which tracks the volume of funds entering and exiting BTC markets. A sharp drop, like the one seen below the chart, implies that the volume of outflows drastically eclipses the volume of inflows.

In other words, there is more selling volume relative to prevailing buying volume – a situation likely to keep Bitcoin price depressed and unable to break resistance at $31,000.

In other news: Crypto is Digital Gold – CEO of Blackrock

Blackrock CEO Larry Fink, in his latest interview with Fox Business, explained on the spot the BTC ETF filing with the SEC in June. According to Fink, the leading global asset manager is open and ready to work with regulators to resolve any issues that may arise with the proposal.

“What we’re trying to do with crypto is democratize it and make it a lot cheaper for investors,” Fink told Fox Business.

While speaking specifically about Bitcoin, the CEO referred to the biggest crypto as an “international asset”. According to him, Blackrock is “a fan of product digitization”.

Despite his positive remarks, Bitcoin price slipped, testing support at $30,500 weighed down by FOMC minutes, which hinted at the possibility of a “mild” recession in the US.

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John is a renowned crypto analyst and journalist, providing expert insights into both broad and focused aspects of the digital asset market. As a steadfast journalist, he keeps his audience informed of the latest crypto news, covering topics such as price trends, on-chain data analysis, non-fungible tokens (NFTs), decentralized finance (DeFi), centralized finance (CeFi), and the ever-evolving metaverse.

The content presented may include the personal opinion of the author and is subject to market conditions. Do your market research before investing in cryptocurrencies. The author or publication assumes no responsibility for your personal financial loss.

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