Home Ethereum Bitcoin/Ethereum outlook: BTC/USD, ETH/USD weighed down by…

Bitcoin/Ethereum outlook: BTC/USD, ETH/USD weighed down by…

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Bitcoin/Ethereum outlook: BTC/USD, ETH/USD weighed down by…

(MENAFN– DailyFX) Cryptocurrency Outlook: Bearish

  • BTC/USD erases August gains as economic turmoil drags sentiment down
  • ETH/USD ends six-week rally, July low looms
  • US economic data and Fed policy remain key drivers of market sentiment

Bitcoin and Ethereum dragged lower by stronger dollar

Bitcoin is currently down 12% for the week (at the time of writing) as digital assets remain vulnerable to monetary policy that has boosted dollar strength.

Visit DailyFX Education to learn more about the impact of politics on global markets

The same fundamental factors that have boosted markets since the invasion of Ukraine remain a concern for cryptocurrency. With energy prices, rampant inflation and the gloom weighing on risky assets, rate expectations have recently emerged as the main catalyst for price action .

After being rejected by the $25,000 resistance level late last week, the FOMC minutes release on August 17 revealed that the Federal Reserve will continue to pursue QT (quantitative tightening) by aggressively raising rates. until inflation is brought under control. This poses an additional threat to the broader crypto market while supporting the safe-haven dollar.

Bitcoin (BTC/USD) Daily Chart

Chart prepared by Tammy Da Costa using TradingView

ETH 2.0 is expected to launch on September 15, which would successfully complete the transition to a proof-of-stake (PoS) network. With the merger expected to reduce power consumption for transaction processing, Ethereum ended its six-week rally, falling to July lows at $1,656.

Ethereum (ETH/USD) Weekly Chart

Chart prepared by Tammy Da Costa using TradingView

For the remainder of the month, Core PCI, Fed Chair Powell’s speech, Michigan sentiment, and the Jackson Hole Economic Policy Symposium to be held August 25-27 will likely ripple through the crypto markets.

DailyFX Economic Calendar

For those unfamiliar with this event, the annual conference hosts prominent market players including central bankers and finance ministers from around the world. With this year’s topic focused on “reassessing constraints on the economy and politics,” Chairman Powell is in the spotlight as investors await confirmation of the trajectory of rate hikes for the rest of the year. the year. If the comments from the symposium are likely to shed some light on the severity of the current crisis or if rates show no sign of letting up anytime soon, the downtrend in cryptos could see Bitcoin retest the $18,000 mark.

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— Written by Tammy Da Costa, Analyst for DailyFX.com

Contact and follow Tammy on Twitter: @Tams707

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