Bitcoin Unlikely To Massively Breakout in 2022, Says Crypto Asset Manager CoinShares cryptomarketbag Blockchain update


Bitcoin (BTC) is unlikely to see a major impulse to balance this year at least, says digital asset manager CoinShares.

in a new bi-weekly report goodCoinShares says the US Dollar Index (DXY), which pits the USD against a basket of other fiat currencies, may have more gas left in the tank of its multi-month rally.

A higher DXY usually indicates downward pressure on most riskier assets such as bitcoin.

“The DXY looks overvalued, but may appreciate further in the near term, while the prospect of a recession is not conclusive. It appears that the monetary policy terminal rate (according to consensus) peaks before its major trading partners in the US This, coupled with the prospect of weak economic data in the US, suggests that the DXY is likely to move towards the end of the year.

Due to the highly inverse relationship of bitcoin price to DXY, bitcoin price is unlikely to see a significant upside breakout this year unless we see an unexpected drop in macroeconomic data.

Leading crypto asset managers say a sharp monetary policy change by the Federal Reserve is unlikely anytime soon, adding an added burden to BTC.

“It is clear, at least for now, that the US Federal Reserve (FED) is not going to ‘pivot’ to a softer monetary policy stance, as many had expected at the recent Jackson Hole event. This had an immediate impact on the US dollar and interest rate-sensitive assets such as equities and bitcoin.

Unless their perception of macroeconomic data justifies a pivot, the Fed’s scathing rhetoric could have a continuing impact on bitcoin’s price outlook.

CoinShares continues to put pressure on bitcoin until “an unexpected drop in macroeconomic data shows up.”

At the time of writing, bitcoin is trading at $19,178, or about 72% from its all-time high of $69,000.

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