Monday, 4 March 2024

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Bitcoin price fails $38.5K breakout as US GDP fuels Fed hard landing woes

Bitcoin price fails $38.5K breakout as US GDP fuels Fed hard landing woes

Bitcoin (BTC) shrank back from resistance after the Nov. 29 Wall Street open as United States GDP figures beat expectations.

BTC/USD 1-hour chart. Source: TradingView

GDP sets tone for macro-sensitive crypto

Data from Cointelegraph Markets Pro and TradingView followed a familiar BTC price retracement on short timeframes.

Bitcoin bulls had managed to propel the market above $38,000 the day prior, only to flip flop around that level before ultimately dropping as U.S. macro data hit.

This showed Q3 GDP accelerating beyond anticipated levels, coming in at 5.2% versus 4.9%, respectively.

This renewed concerns over how the Federal Reserve might handle policy ahead of an interest rates decision in mid-December.

“5.2% is the final reading, it will mark the highest GDP growth since Q4 2022,” financial commentary resource The Kobeissi Letter wrote in part of a reaction on X (formerly Twitter.)

“Can the Fed achieve a soft landing?”

U.S. GDP % change chart (screenshot). Source: U.S. Bureau of Economic Analysis

Kobeissi referenced words from Bill Ackman, CEO and founder of hedge fund Pershing Square Capital Management, who the day prior had gone on record to predict a Fed rate pivot as soon as Q1, 2024.

“Yesterday, Bill Ackman bet on a hard landing with rate cuts beginning in Q1. Currently, futures don’t see rate cuts beginning until June 2024,” it continued.

Data from CME Group’s FedWatch Tool showed marginally increasing bets on a further hike in December following the GDP release, with further key data due on Nov. 30. The odds of a hike stood at 4.2% at the time of writing versus 0.5% previously.

Fed target rate probabilities chart. Source: CME Group

Analyst: Bitcoin is a buy below $35,000

Bitcoin meanwhile continued acting in a familiar style from recent days.

Related: ‘Buy the rumor, sell the news’ — Bitcoin ETF may spark TradFi sell-off

Bulls still failed to crack a key resistance zone beginning at $38,500, despite some being confident that an assault on $40,000 would ultimately result.

“No HH or breakout confirmation yet, eyeing a sweep of $37.3K area & HL setup for the HH,” popular trader Skew told X subscribers, referring to a “higher high” being required.

Fellow trader Daan Crypto Trades suggested that a period of flatter BTC price performance could now enter…

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