Why Sell In May Might Not Work This Time For Bitcoin

News BTC

Bitcoin pushes up on the last day as the market prepares for the upcoming speech from the U.S. Federal Reserve (FED) Chairman Jerome Powell. Despite the recent gains, the general sentiment in the crypto market remains bearish.

Related Reading | Bitcoin Seen Dropping To $32K – But Not This Month – As Analyst Sees It Hitting $48K

At the time of writing, Bitcoin trades at $38,800 with a 1.5% profit in the last 24-hours.

5 BTC + 300 Free Spins for new players & 15 BTC + 35.000 Free Spins every month, only at mBitcasino. Play Now!

BTC moving sideways on the 4-hour chart. Source: BTCUSD Tradingview

The first cryptocurrency by market cap could surprise market participants. Some operators have started predicting a massive crash ahead of Powell’s intervention.

How To Get Free Crypto  

The old market adagio “Sell in May and go away” seems more present than ever as the sentiment turns fully fearful. In a recent report, trading firm QCP Capital revealed their chain is biased as the bearish sentiment seems “slightly over-extended”.

In that sense, the firm claims that market participants could have priced in any FED announcement “too aggressively”. Thus, if the financial institution seems dovish or announces an interest rate hike within expectation, the crypto market could be poised for some relief. QCP Capital said:

BitStarz Player Lands $2,459,124 Record Win! Could you be next big winner?

Get 110 USDT Futures Bonus for FREE!

With bearish sentiment at extremes, we could see a potential short squeeze in the near-term. This might be the rally we have been waiting to sell into as the multiple-compressing effect from QT and recessionary pressures from the rate hikes begin playing out (…).

This could take some months before it comes into effect. In the meantime, BTC might break back above the $40,000 levels.

As NewsBTC reported, there are two scenarios for global markets in 2022. An aggressive or dovish FED. The latter is the best for the price of Bitcoin and other risk-on assets.

Coinbase Banner  

Why Bitcoin Could Benefit From Market Anticipation

The financial institution could be softer at the execution of its monetary policy if the market reacts ahead of future announcements. QCP Capital believes this is already happening:

(…) price reactions in anticipation of the FED are effectively serving the FED’s goals. Powell said on 21 April that he was pleased that markets have reacted to the FED’s hawkish indications. (…) we have seen some of the largest moves across markets in years.

The firm claims that market participants expect as much as 75 basis points (bps) interest rate hikes. This is a highly aggressive approach which means that anything below that could be beneficial for Bitcoin and the crypto market.

In that sense, QCP Capital claims the market is doing the FED’s job by keeping prices down and reacting to announcements. The firm added: “this gives the FED more breathing room in their fight against inflation”.

Moreover, QCP Capital believes inflation might be finally reaching a peak. Thus, why the FED might dial down on its rhetoric, or at least it will allow it to stay within expectations.

FreeBitcoin Banner  

Related Reading | Bitcoin Taker Buy-Sell Ratio Rebounds Back Into “Hold” Zone

In case of potential downside ahead of Powell’s speech, the firm pointed at BTC’s price 50% retracement from its all-time high around $36,400 and its 61.8% retracement at $28,700.

Go to Source
Author: Reynaldo Marquez

Recommended Crypto Services, Products and Strategies:

The first thing any crypto investor needs is is a reliable and secure Crypto Wallet.  Whether you’re looking for an online wallet, hardware wallet, desktop or mobile wallet, Crypto Renegade provides you with all the Best Crypto Wallets in each category.

Best Crypto Wallets Banner

When you’re ready to buy more crypto, or exchange your coins for others, Crypto Renegade’s list of the Best Crypto Exchanges has you covered.  The Crypto Exchanges recommended here offer everything from simplicity and convenience to advanced trading platforms and profit sharing. 

Best Crypto Exchanges Banner

If you want to learn more about the methods and tools that can be used to find Great Crypto Projects, then be sure to check out Crypto Renegade’s strategy for How To Find The Best Cryptocurrency.

Crypto Strategy Banner

For those people that don’t have any money to invest right now, or just want to understand the technology a bit more, you’ll definitely want to check out Crypto Renegade’s Free Crypto Strategy and start collecting Free Coins today!

Free Crypto Banner

What do you think about cryptocurrency? Do you have any questions about it? Be sure to leave a comment below.

This site uses Akismet to reduce spam. Learn how your comment data is processed.