You are currently viewing Bitfinex bids hint at Bitcoin price reversal post Fed commentary expected this Wednesday
  • The upcoming Federal Reserve ahead this week has put major pressure on the equity and crypto market with the possibility of a stimulus tapering plan.
  • However, multiple BTC/USD bids appearing on Bitfinex around $46K levels show the trader sentiment of “sell the rumors, buy the news”.

The recent price crash in Bitcoin and the broader crypto market has elevated investors’ pain further. Earlier today, the Bitcoin price fell under $47,000 levels in the broader market sell-off. However, the Bitcoin downside could soon see an end following the Fed commentary on Wednesday, December 15.

On Tuesday, December 14, the BTC/USD bids started increasing on Bitcoin exchange Bitfinex hinting that Bitcoin is destined to rise further. There’s been some fear around in the market regarding the Fed starting its stimulus tapering plan. Besides, talks about the inflation fears and the Fed slowing down on its bond purchase program state that there will be a knock-on impact on the crypto and the traditional markets.

Looking at the Bitfinex order books, it becomes clear that Bitcoin traders are seeing an opportunity to “buy the news”. Crypto analyst Zen wrote on Twitter:

Bitfinex laying down bids. Retail selling into the lows ahead of FOMC Meeting with funding negative across the board. Feels like we’re going to get a Buy The News event.

During the pandemic, the Fed has been putting excess liquidity in the market to keep the economic activity going. A lot of this money has moved into equities and crypto, helping the market rally strongly. But with tapering the liquidity plans will put a break to the availability of “easy” money. This would also put risk assets like Bitcoin under pressure.

Related: Federal Reserve Chairman warns of Inflation lasting longer than expected

What happens post the FOMC meet?

As the Federal Open Market Committee (FOMC) meets ahead on Wednesday, December 15, the picture will get clear with the Fed’s inflation commentary. Currently, the Bitfinex traders are placing bids in the price range between $44,500 and $46,000. Popular crypto analyst Will Clemente added:

Think FOMC has a good chance to be a “sell the rumor, buy the news” event. Pair that with illiquid supply back at yearly highs and some large Bitfinex bids coming in. Just waiting for $53K to start bidding. Happy to miss some of the move and essentially pay for confirmation.

While the bitcoin price continues to decline, the BTC supply at the exchanges has been declining as well. On-chain data provider Santiment reports that the Bitcoin exchange supply has reached a 31-month low. “the lack of $BTC moving to exchanges right now is a positive sign that major selloff risk should be limited,” it adds.

The recent correction in the Bitcoin price comes as it fails to break past key resistances. Popular market analyst Michaël Van de Poppe said that there’s a bullish divergence pattern formed at the levels of $46.5K.

Der Beitrag Bitfinex bids hint at Bitcoin price reversal post Fed commentary expected this Wednesday erschien zuerst auf Crypto News Flash.

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