This week's macroeconomic market was driven by the speech of Federal Reserve Chairman Jerome Powell on October 19th. The victory of grayscale has almost become a foregone conclusion, as the US Securities and Exchange Commission has decided not to appeal the court's ruling
This week's macroeconomic market was driven by the speech of Federal Reserve Chairman Jerome Powell on October 19th. The victory of grayscale has almost become a foregone conclusion, as the US Securities and Exchange Commission has decided not to appeal the court's ruling. The weekly chart shows a trend reversal signal in Bitcoin prices, indicating a possible downward trend.
The important macroeconomic event of this week was the speech of Federal Reserve Chairman Powell on October 19th. Due to higher than expected non farm employment and inflation data, Powell implies a higher possibility of further interest rate hikes. However, the CMEFedWatch tool shows a 90.3% likelihood of maintaining the positive policy rate at 525-550 basis points. Although this speech may have a short-term impact on the price of Bitcoin, investors need to remain cautious when trading Bitcoin as the future situation may become unstable.
The weekly signal of Bitcoin prices suggests selling. Bitcoin prices have turned bearish, meeting two key conditions to reverse the upward trend, namely a lower low and a lower high.
Specifically, in the first week of September, Bitcoin prices plummeted to the first week low of $25941 in June and reached a weekly low of $25386. Although this trend met the first condition for a trend reversal, in the first week of October, a lower high of $28592 was generated, which met the second condition for a trend reversal. The satisfaction of these two conditions indicates that Bitcoin prices have officially issued a trend reversal signal on the weekly basis, indicating that the upward trend in 2023 may come to an end.
Looking ahead, investors need to remain cautious, especially considering that Bitcoin's history suggests that once a trend reversal signal is reached, breaking through a critical level may trigger a significant downward trend of volatility. A potential target is a psychological level of $25000, which could lead to a nearly 26% drop to $19294 if breached.
However, the possible approval of spot Bitcoin ETFs can change this bearish outlook. The US Securities and Exchange Commission (SEC) seems unlikely to appeal and reconsider its ruling on Grayscale's spot Bitcoin ETF, which increases the chances of obtaining approval for spot Bitcoin ETFs. Regardless of the outcome of this victory, Bitcoin only slightly surged in the upward trend, but failed to sustain it.
Therefore, the approval of spot Bitcoin ETFs is the only factor that may overturn the bearish outlook mentioned above and trigger an upward trend in Bitcoin. Investors may pay attention to this aspect in future decisions.
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