Bitcoin at Risk of Crash as Interest Rates Should Not Be Lowered

Bitcoin and Cryptocurrencies Threatened by Fed Warnings

Recent statements from a high-ranking official at the U.S. Federal Reserve (Fed) have shaken the cryptocurrency market this week. Beth Hammack suggested that the Fed should not lower interest rates in the short term, as inflation remains at elevated levels.

Her remarks, made during the Jackson Hole symposium, come just days before the highly anticipated speech by Jerome Powell, the Fed Chairman. Powell is expected to respond to the latest economic indicators on employment and inflation, which remain mixed.

Another Crypto Market Decline on the Horizon?

Beth Hammack’s warning triggered a drop in Bitcoin (BTC) prices on Thursday, pushing it below $112,000, well below its all-time high of $124,200. The overall market capitalization of the sector retreated by 1.45% to $3.8 trillion, with altcoins like Mantle, Virtuals Protocol, Official Trump, and Ethena among the hardest hit.

Beyond this immediate reaction, the cryptocurrency market could experience a prolonged bearish phase in the coming weeks. Indeed, Bitcoin has recently formed an extremely bearish chart pattern, the “ascending wedge,” which typically signals a significant downward breakout.

This pattern, composed of two converging trendlines, coincides with the appearance of a “shooting star” on BTC’s weekly chart, another major bearish technical signal. Such a scenario could push Bitcoin below the $90,000 mark, with negative repercussions for the entire crypto market.

Strategy and Key Levels to Benefit from This Potential Decline

According to trader Honey, a DCA strategy between August 23 and September 21 allows investors to optimize their investment.

Although a drop below $90,000 seems unlikely, Killa estimates that it could fall between $100,000 and $106,000 when observing the USDT dominance chart. Indeed, if USDT.D breaks upward, a return to 5.2% is highly probable, which would signal a retest of $100k for BTC.

Moreover, $103,000 and $106,000 correspond to liquidity clusters and support levels of short-term holders’ MVRV and SOPR.

In conclusion, investors must remain extremely vigilant in the coming weeks regarding the positions taken by Federal Reserve officials. Their statements could indeed trigger a new wave of massive selling in the cryptocurrency market, threatening the recent price recovery.

However, a crash below $90,000 is still far from certain. The support zone between $108,000 and $100,000 will be crucial for a rebound.

Buy Bitcoin (BTC) on Bybit in a Few Steps

To take advantage of this dip with a DCA strategy over the next 30 days, here’s how to easily buy Bitcoin on the Bybit exchange:

1. Create a Bybit account: Go to Bybit’s official website or download their mobile app. Sign up by providing an email address and a secure password. Validate your account via the confirmation link sent by email and complete identity verification (KYC) if necessary.
2. Deposit funds: Log into your Bybit account and access the “Deposit” section. You can deposit cryptocurrencies like USDT or fiat currencies (depending on your region). Transfer funds from an external wallet or buy directly using a bank card or wire transfer.
3. Access the spot market: Once your funds are available, go to the “Trading” tab and select the spot market. Search for the BTC/USDT pair (or another pair depending on your funds).
4. Place a buy order: Choose a market order to buy immediately at the current price or a limit order to set a specific price. Enter the amount of Bitcoin you want to purchase and confirm the transaction.

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