A widely followed crypto analyst says he thinks he knows what’s fueling Bitcoin’s (BTC) most recent upward rally.
Crypto trader Michaël van de Poppe tells his 653,200 Twitter followers that he expected more downside out of BTC than he’s currently seeing.
“Bill to propose Bitcoin mining in the US is a positive thing for the markets, probably fueling the upwards rally.
Expected more downside, but broke through $27,700 and clearly going for the highs, have to see how we stand there.”
Van de Poppe had previously expected BTC to be on the downtrend after yesterday’s Federal Open Markets Committee (FOMC) meeting.
“Powell stated the obvious. He needs to continue hiking the interest rates, while he’ll add more to the balance sheet to save banks.
Bitcoin corrects and I think we’ll go down some more. It’s not a great recipe to go bullish into a FOMC event.”
After yesterday’s FOMC meeting, Van de Poppe said the jobless numbers were good for the US Dollar Index (DXY). The DXY measures the US dollar’s relative strength against a basket of other major foreign currencies. Generally speaking, a strong DXY can imply weakness in risk assets like crypto.
“Jobless claims more positive than expected; 191k vs 197k.
Good for Powell, good for DXY.”
Though the analyst thought BTC would correct, the king crypto’s movements in the last 24 hours now lead Van de Poppe to believe that Bitcoin could be on its way to $40,000.
“We’re still in the vacuum of relief, the ‘Echo’ bubble.
The period where the potential process of pausing hikes remains to be bullish and there’s no clear recession, until reality kicks in.
Expected Bitcoin to correct to $25,300, but it was $26,200 and now continue to $40,000.”
BTC is worth $28,492 at time of writing.
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Featured Image: Shutterstock/QalexanderK/Konstantin Faraktinov
