BTC Trend When the Fed Will Raise Interest Rates Again

Market situation

At the beginning of the week, the US stock market ended the session with a slight increase. Stock futures also show an uptrend, but not significantly. Gold fluctuates around $1,685 per ounce. Oil price increased to 85 USD/barrel.

The crypto market after last week’s drop has recovered slightly to $19,200. ETH drops to $1300 after consolidation. Altcoins are also slightly up the BTC trend.

Last week, Coinshare statistics showed that crypto had an increase of $7.5 million in inflows. In which, mainly investing in BTC increased but ETH showed the flow of money leaving.

From now until the end of September, crypto has an event to look forward to, Cardano’s Vasil update after a period of delay. The big news that the market is waiting for is the announcement of the Fed’s interest rate hike after its regular meeting on the 21st.

Currently, most investors think the Fed will increase by 0.75%. If the Fed goes higher than investors estimate, it will make financial markets as well as crypto more volatile. The possibility that the Fed will raise interest rates by 1% is not high because the Fed has assessed a 0.75% increase as a high level at this time of the market. At the same time, the upcoming big election in November may also be a factor affecting the Fed’s interest rate decision coming here.

Facing high inflation and the Fed raising interest rates, US government bond yields continue to rise. The yield on the benchmark 10-year Treasury note rose 6 basis points to 3.518%, hitting its highest level since April 2011. Not only that, but the 2-year Treasury note rose 9 basis points. to 3,949%, the highest level since 2007.

Interest rates on long-term home and real estate loans will largely follow the trend of US public bonds. Therefore, when the 10-year bond increases, the home loan interest rate will increase. Homebuilder sentiment in September fell 3 points to 46 in the National Association of Builders / Wells Fargo Housing Market Index. When this score is below 50, it is considered negative, meaning that the need to buy a home (especially to buy a new home) of Americans has decreased. Plus, nearly a quarter of builders report price drops as rates rise. Higher costs of land, labor and materials have made it harder for contractors to cut prices, but if not, it will be harder to sell and recover capital.

Long-term investors continue to accumulate BTC

Ben Armstrong shares his predictions for the upcoming crypto price and notable events. There will be a presidential election in November this year in the US so he predicts BTC price will bottom out in November or December this year. Next, he thinks that the Fed will announce a halt to raising interest rates in mid-December this year, next year BTC and crypto prices are almost flat. By 2024, the US will have a presidential election and the Fed will pump money to boost the market. Bitcoin will have its next halving in the same year 2024. Therefore, Ben Armstrong predicts that BTC will hit a new high this year and surge in 2025. These are his positive predictions for the crypto market.

Returning to the present time, BTC price has just recovered slightly after falling to 18,000 USD. Rainbow BTC price chart added purple as the price dropped from the current color frame. Bitcoin price has been flat in the blue area (of the rainbow) for a while. This is a good price zone to accumulate.

Despite the Bitcoin price drop, more than 65% of BTC has not moved within the past year. Long-time investors remained unaffected by the price drop and continued to hold BTC.

Long-term investors often invest for the long-term and strategically and have applied that principle for many years. A rising market helps many people make money, but a falling market really helps investors get rich. The down price is a good opportunity for investors to accumulate and average a lower price for themselves.