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On January 10th, Bitcoin plummeted below USD 40,000 with a 1.53% loss, the first time it dipped below the USD 40,000 psychological mark since September 2021. Following increased concerns of hawkish policy from the U.S. Federal Reserve, a broader slump in the crypto area accompanied by the sell-off in the traditional financial market. But at the time of writing, BTC price bounced back above USD 42,000 again. Though price expectations for Bitcoin bearish will be more reasonable based on some macro factors, there is some analysis in favor of the potential Bitcoin bull.
The U.S. Bureau of Labor Statistics will release The Consumer Price Index (CPI) for December 2021 on January 12th. As expected, CPI data will rise 7% for the year through December, which indicates that the rising inflation will push the FED to turn more hawkish towards monetary policy.
However, the economist Alex Krüger recently presented a thesis in favor of the bulls via Twitter saying that: “This has been extraordinarily bearish due to the speed of the Fed’s turnaround. Raising rates or tapering quantitative easing (QE) should not be bearish enough to change the upwards trend across assets.”
Krüger also noted that Bitcoin has already dropped too far from its record highs, insofar that it now stands technically oversold. If the upcoming CPI metrics is lower than 7%, BTC could react with a bounce back to USD 45,000.
Based on Glassnode’s latest Dominance Oscillator Between Long and Short Liquidations chart, it shows that traders who longing BTC are consistently being liquidated and in loss since November 2021.
As BTC price trending lower and bear conviction
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