The Consumer Price Index (CPI) data for November dropped on December 13, 2022 and the market reacted positively. Consumer price barely rose, leading to the smallest annual inflation rate of 7.1%.
The news prompted a break out of Bitcoin price as it rallied toward a long awaited zone – $18,500. But will this pump in price be sustained? We think not, and here’s why.
Why This Breakout is Bad for Bitcoin and Crypto?
This recent Bitcoin price rise sets Bitcoin at a very dangerous zone. The market is falsely hoping for a recovery while danger lies in wait. On top of this news, Jerome Powell, FED chairman said he sees even smaller Fed rate hikes moving forward. Such words put hopes in the hearts of many crypto traders – a fatal mistake.
The charts never lie. Something bad is coming after this ‘scam’ pump.
This increase in price only hastens the big fat dump that was already programmed into the Bitcoin price by end of December 2022.
The market generally looked forward to an inflation of 7.3% and hence anything lower than this was good news.
And true to the news, Bitcoin jumped 5-6%, a move that was reflected with a lot of green in the altcoins. Stocks also printed positive increases in price amid this news. But celebrating before the game is over has never been a good idea.
Opinion on the Coming Weeks -Bearish
The coming weeks will inflict max pain on the crypto markets. If you have been reading our Bitcoin price analyses, then you would be aware of the ‘hunch’ we’ve been following about a possible market crash on the week of December 20th – next week!
The closer we get to this possible black swan event, the more the technical indicators play out to strengthen the narrative. The Bitcoin chart is primed for a 40-50% drop that will leave the market totally devastated. If we break the strong support between $16,242 and $15,631, then we could head down as low as $8,000. This is a call to secure your funds in stablecoins.
Vincent Munene is a freelance writer and a great blockchain enthusiast. Blockchain has changed his life in terms of financial freedom and in return, he likes to educate people and keep them up to date on everything blockchain. He is a Biochemist by profession and also loves to play the piano.