WTF?!!! BITCOIN BOUNCES ON FED NEWS!!!! What’s REALLY Happening… [don't be fooled]
Now, if youre wondering why todays video is coming out a little bit later than usual its because i did not really see a point in making a video until we officially had the fed announcement and we could see how markets were reacting so as you can see Right here they did in fact go through with the 0.75 or 75 basis point raise, and this is in fact the largest increase since 1994. This is going to increase the benchmark federal funds rate to about 1.5 percent and 1.75 percent. So how are markets reacting? Well, if we just start with the traditional markets right here, the s p is actually having a bit of a bounce which, actually, interestingly enough, coincides perfectly with this downward sloping trend. So it is interesting how both the news and the technicals lined up today were going to get to bitcoin in just a minute, but if youre wondering why the markets are reacting positively to a 75 basis, point raise well. Let me just tell you before we get into the charts, if you guys want to know its simply because theres really one thing that markets hate more than anything and thats uncertainty right. So we know when we had the covid pandemic happen and we saw the black swan crash. That was something that was unpredictable right, but if we are anticipating a bit of bad news well, we tend to price it in which is probably why the market did see.
All these red candles they were anticipating or pricing in the bad news. But since the news, even though wasnt great news, it was what we were expecting the market said: okay, sure this is what we were expecting. Thats all right lets continue, so there is a possibility that until the next fed meeting we could actually be due for a little bit of that relief rally. So super quick today, guys if youre not subscribed, definitely consider it todays video is going to be super short. I just want to bring you sort of an overview of where were at what we can expect and what to look forward to right. Interestingly enough, you are noticing that the dxy is in fact pulling back right, so lets hop in and lets have a look at what bitcoin is doing right here by the way i just wanted to super quick point out that the bitfinex longs are still longing. So maybe they knew something – maybe they were anticipating this right? Well, good on you guys, if you got the bottom of that, although theyve been longing ever since april 12th, so i dont know hopefully theyre not underwater. But the very very interesting thing that i wanted to point out was regardless of what actually came out. Look at these perfect up, perfect, perfect technical levels, perfect! Well, that should be a word, so you can see right here guys look at this, so we had this 2017 top right here right and if we zoom over here, we noticed that we had a little bit of resistance come over here and look at where we Touched guys i mean literally within just a few dollars.
We basically almost exactly touched that level, which is why you always have to pay attention to the technicals right, and i told you this little thing right here that everyone was saying around 23 600. It wasnt strong enough of a support you could see, we didnt even hesitate essentially to just push right through it right. So what does this do for bitcoin? Well, it honestly opens up the door potentially for a revisit back up to some of these levels. We might have a little bit of a stall out at around 23 700, but the most important thing to pay attention to is this area right here, because you could see that ever since all the way back here in january of last year, we had been holding Up on a lot of support, you could see multiple touches here. Three different touches here a little bit of consolidation here, so this does mean that bitcoin could attempt over the next month to potentially find its way back to that 29 000 area. But do understand that since this was held so long as a support, it is going to be the level to watch moving forward for resistance right. So i do believe personally that we could see bitcoin rally upwards towards around that 29 000 level, maybe going into the next fed meeting. But at that point we could be looking at some serious, serious resistance. So as ive been saying when you are in a bear market, what you want to do is you want to short the resistances, so obviously the trade to potentially take would be to short around the 29 000 area, although in all honesty, low leverage, not financial advice.
I think would be all right, potentially maybe for the next couple of weeks, although we never know what could come out right, if you do want to learn how to trade, though, make sure that you obviously use a test account. First, i do have tutorials popping up above theres, 23 000 more than that actually in bonuses below. But what i do want to mention, which is pretty cool or at least good short term, is the fact that you know bitcoin is slowly trying to approach back above that 200 weekly moving average, which is around 22 360. and remember anytime in the past, no matter When we ever touch this, we usually do end up going back above that level within the next week now, although the economic circumstances right now are very very different than what weve seen in the past for bitcoin, i would say that that could be a potential. Surefire bet short term, and the other thing to point out is that we have maintained this upward sloping trend this historical trend right see all of this – that we had right here and obviously you know just get rid of the covid crash, because that was a black Swan event – and you could see – look at this bitcoin was continuing nicely eventually. You know we went up on this crazy. You know pump all the way up to around 64 000, 65 000 and after a year and a half weve come back down and weve.
Actually, perfectly almost perfectly, you know, within a few dollars, essentially retested that level, which does technically mean that this trend is still intact, but on the flip side, we also have this downward sloping trend, and this trend is going to continue sloping downwards and downwards until we Reach an apex right here right around uh. You know essentially the end of this year right around december right. So this is something to pay attention to. If, by chance we are able to rally above the 29 000 level, provided that the fed doesnt get a little bit too crazy, then you know it is possible. We come back up here, depending on when we reach that, obviously the longer it takes us to reach it, the lower this level will be, but we will keep our eyes on this, make sure you guys are subscribed to the channel. We will be monitoring these levels as they approach, but right now, bitcoin is essentially just between its upward sloping trend and its downward sloping trend, and this is where we find ourself right here: okay, so that is sort of the bitcoin price action. But what i did want to sort of mention is: do you think that the fed actually has the guts actually has the gumption to go through with what they say, theyre going to do, or do you think that they may actually end up chickening out? I do want to play a clip super quick before we get into the rest of the um.
You know whats going on in the markets. I want to talk about rick rule. This was actually a clip over from stansberry research, this guy hes a long term investor speculator. He has invested in things like oil uranium silver stuff like that, and he actually suggests that. Maybe they could chicken out the cpi stated rate of inflation is eight and a half percent. Now that would mean that the u.s ten year treasury rate would have to be nine percent. That would mean that the interest payment on federal state and local debt would triple. Traditionally, the 30 year, fixed mortgage rate, has traded at a premium to the u.s 10 year treasury, which meant, which means that uh 30 year fixed mortgage rates, would have to go to nine and a half percent. Think what that would do to young peoples ability to buy houses? If we had a period of real interest rates, it would certainly cure inflation, but it wouldnt cure inflation before it did amazing damage to various balance sheets, and so my suspicion is that as interest rates rise before they even got to real yield levels that the damage To the economy and the pain and anger that it would inflict among voters will cause the fed and the political class to chicken out, but regardless of whether or not they do end up, you know you know pulling back on their hawkish stance like jim uh, jury And timmer pointed out and hes over at fidel fidelity, hes, actually a director of global macro.
Over there he asked the question is bitcoin cheaper than it looks. If we consider a simple pe metric for bitcoin to be the price network ratio, then that ratio is actually back to 2017 and 2013 levels, even though bitcoin itself is only back to late 2020 levels, valuation often is more important than price. He goes on to say another way to highlight this is by overlaying bitcoins. Non zero addresses against its price price is now below the network curve. The next chart right here shows that we are or how technically oversold bitcoin is. According to glass nodes, dormancy flow indicator. Its now at levels not seen since 2011., so, regardless of what you think about whats going on right now, it does not mean that the price couldnt go lower. In fact, remember i told you guys when we get these capitulations over on the hash ribbon chart it doesnt mean that were at the absolute bottom or that the worst is over. It just means that its usually generally close, right and remember our estimate is about one to three months, so we do have to see what the fed does do continuing you know moving forward. However, these are the optimum levels historically for accumulation so sure it could go lower, but dollar cost averaging at these levels is honestly based on the charts based on the data based on history and amazing time to be getting into bitcoin, because once we do break out Of this bear trend, which, inevitably we will, it always does happen, no matter how you feel about it.
Looking back on this, a lot of people will in fact be kicking themselves as to why they not or why they didnt get into bitcoin right. But, as i said in my video from two days ago, you have to understand that things are changing and, yes, it is for the better in the sense of crypto, uh or specifically bitcoin and ethereum. But as far as crypto as a whole regulations are coming now. Like i said, this is good, because this is allowing bitcoin – and you know potentially some of these other cryptos to actually become part of the monetary system, maybe not so good for some of these speculative coins. But honestly, you could say it might be good, because a lot of people do get scammed and there are a lot of scams out there right. So policymakers in washington are watching the situation around crypto, specifically with what happened with celsius which froze. Obviously, you know what happened: the ability to withdraw and sec chair gary gensler briefly made a comment about it on tuesday, so they are looking into this and they are looking to make some changes. You can see. The sec is worried that crypto exchanges could enable insider trading. Of course i mean we know that its still the wild west in most of these exchanges and the sec wants crypto exchanges to have checks in place to prevent insider trading. But that being said, i want to end on a little bit of cool news, so new york, uh mayor eric adams, is actually calling on the states governor to reject a bill that was placed that was placing a two year moratorium on proof of work, crypto miners Who do not use 100 renewable energy? The mayor plans to push for the bills.
Rejection citing new york would suffer an economic impact if it is passed into law. According to adams enacting the law will likely wipe out gains made by the state in establishing the crypto sector, while negatively impacting the states economy. He says im going to ask the governor to consider vetoing the bill that is going to get in the way of cryptocurrency upstate. When you look at the billions of dollars that are spent on cryptocurrency new york is the leader we cant continue to put barriers in place, and i definitely think i agree with him and we should probably get rid of that bit. License too thats. Definitely holding you guys back wink wink, not nod, but that being said you know we do know that wall street is essentially the financial capital of the united states, and i do think that new york needs to get on board with these guys, like wyoming and miami And texas, and all these other places right, so that is it for me today. Guys just want to give you a quick update if you enjoy. These updates. Um still even went a little bit long on todays video. But what would you expect any less from the zombie? So that being said, i love you guys youre awesome. We will see how this plays out um. You know the s p, still having a pump right here going back to bitcoin right here. In fact, from the bottom to the top, which i mean you got ta admit guys as much as the news affects price, look at those technicals look at this level that we had look at the bounce.
This is why you have to pay attention to the charts from bottom. To top, we had a beautiful about eight and a half percent move right now. So, if you guys were trading on some lower leverage, you might have made some nice gains be safe out there. That is it for me today.