I think all of these factors are going to affect the price of the crypto markets in the first half of 2022, im actually still very bullish, but theres things to watch out for so lets get into it. Firstly, before we get into the video i have a cryptocurrency giveaway in january, so go ahead and enter that if you want im giving away ten thousand dollars of crypto uh just come and follow me on twitter um. This. This giveaway is actually sponsored by pioneer x. Theyre, a crypto trading bot platform – i use them, you can see. Ive got some bots running um at the moment, um ill leave the link in the description just go ahead and enter that you could win uh up to ten thousand bucks, but i want to get into the bitcoin chart now. Everyone says cryptocurrency is extremely volatile and i do agree with them. The last few months have been boring right, weve been in this huge consolidation phase and we are still in this were actually at the bottom of this range right now. Um and i have to actually redraw this area of value uh just to make it longer because weve just been ranging for so long, and the thing is: is that um really the market? Is anticipating whats going to happen with rates right? So obviously, at the moment the fed has come out and said we need to raise interest rates. We need to stop the buying because inflation is so high.
Inflation figures are the absolute key to watch out for with the price of bitcoin. So i want to touch on that later, but for now, in terms of technical analysis were just still in this range, it just seems like every time there is a bid trying to raise the price of bitcoin. It gets hit and sellers come in and just force. It down volumes are low and the volatility is low and it just seems like we are ranging here. It seems like were waiting for some actual economic figures to be coming out, um late in the later weeks, so thats, where we are for now also looking at ethereum, um ethereum, looks really quite strong and theres some reasons for this. So you saw this dip out of this area of value right, so we had this consolidation phase once more, we actually dipped underneath right. So sellers came in and said right lets, try and test this, and it looks like buyers have come back in and pushed the price up. Why is that? I think its because of nft volumes so going over to june analytics. We can see nft trading volumes on openc. You know we definitely had a lull right towards the end of last year october. Definitely trading volumes came off, but look at whats happening now were just seeing nft trading volumes tick up once again on openc. We have another one right here. You can definitely see that nfg trading volumes are ticking up and obviously to trade nfts.
You need ethereum, and that is where i think the demand is coming from to basically keep ethereum um in this kind of consolidation phase or not. Um going down as much as it may otherwise, so some fundamental usage is keeping the price high and thats. A theme that im looking at in the future, where, where i want to invest, is basically in chains that have fundamental usage right. So actual people actual economies built on top and definite demand for a token for a use case and that will obviously um be very beneficial for that token, in the future, so thats, what im looking at going into 2022 and beyond, is really actual use cases and Where the actual people are using these tokens thats, really where i want to be the thing that will affect the price most in q1 2022 is inflation and not inflation itself, but actually how the fed deals with inflation and how the rate of inflation is changing. So, as we know, most people say that bitcoin is an inflation hedge right, so an inflation hedge is supposed to go up in value when inflation rises, and that is true and also not true. It depends on the time scale, and it also depends on how the fed actually reacts to inflation. So over the long term, a an asset that goes up in price is obviously an inflation hedge, because inflation is pretty much constant at some level, and so anything that goes up um, you know ahead of inflation, would be considered an inflation hedge and equities can be An inflation hedge, but obviously this type of asset really is kind of more towards gold, or you know bitcoin, which is kind of a digital gold in some senses.
An inflation hedge put your money in there when inflation is high um to as a trade to kind of uh. You know um secure some sort of upward movement in the price against inflation, now thats kind of true and kind of not for uh bitcoin. So we can actually just look it isnt inflation itself that changes the price of bitcoin. It is the u.s federal reserves, reaction to inflation and how it changes, interest rates and monetaries policy that actually ref um affects the price of bitcoin and ill. Show you this on the chart so obviously towards you know um in 2020, you know when we had everything going on the fed cut rates to zero to literally zero right instantly. They just said right were gon na cut rates to zero and were gon na buy 700 billion dollars worth of assets right, which is mostly their own bonds. Um lets go over to the chart of bitcoin and see when this happened right, so we can go down and what we want to do is find um. The the the time which was march 15th 2020. so well, come in here march uh, which is, is right here its this point here right. So you had this big sell off in the market right when the you know, when everything was happening, fed stepped in and said right were just gon na print money and were gon na give everyone. Money and um were also going to put interest rates to zero.
Literally, you can see on the same day, 15 15th of march 2020, the price of bitcoin started rising and it just rose and rose and rose and has been rising ever since. So what that tells me is that the price of bitcoin is related quite closely to the fed printing billions of dollars, basically um increasing the money, supply and huge um lack of purchasing power for the dollar right, so the basement of currency. But inflation is very high. Now, inflation we know, is six percent cpi much higher than that. Really, you know thats the official figures so why isnt bitcoin at all time highs? Inflation is high right, so bitcoin should be all time highs, but it isnt it actually started coming off around november time. So another article – and we can see the fed again is expected, is, is expected sorry to take a very big step towards a rate hike, raising interest rates and reducing the amount of assets that it borrows, essentially tightening its policy making money more expensive. Now this was in december, but actually they started signaling this from november when they started admitting that inflation wasnt transitory inflation has become a massive problem. It is a big problem for the fed, and so they need to come out hit it hard, become hawkish and say were not printing as much money were raising interest rates. We want the economy to slow down. We want inflation to slow down. That was around november time, and you can see the price of bitcoin reacted perfectly to it there, with rising interest rates, money becoming more expensive and the fed saying hold your horses.
Bitcoin has come off so for me, bitcoin doesnt rise with inflation. It rises with essentially the price of dollars and how strong or weak dollars are and how much they can buy. You so obviously, relating this forward. What the fed does now in the first half of 2022 and what inflation does is going to be the key thing that affects the price of bitcoin and therefore um. You know all the other all coins that are obviously going to trade off this. If inflation does subside a little bit, the fed can ease off and say: hey, you know what we dont have to raise interest rates as quickly or as much, and we can be a little bit looser with monetary policy. I think the price of bitcoin um well just have a bigger bid, underneath it prices should kind of melt up if inflation continues to be really high and a big problem for the fed, i think the fed still has to remain very hawkish reduce asset purchases. You know raise interest rates and just be a very hawkish fed. That doesnt seem like its going to be a very good uh thing for the price of bitcoin in general, so thats what im looking at really this year, i obviously dont know whats going to happen with all of this. We have to wait for the numbers, but if youre looking for general generally whats going to happen, the price of bitcoin and therefore cryptos, it really is the inflation figures and then how the fed reacts to those.
Apart from this, there are really four things that i can see massive catalysts for this year. That im also looking at that, are going to be very separate from this, and i think we could still see a lot of volatility, maybe trading up because um of these events, so actually ive got them written down here. The first one is a spot bitcoin etf weve got these around the world were really looking for the states to do something right. So i think this is a positive if we have a spot etf, its a general positive, because obviously we can have a lot more cash and assets flowing into the space generally. If a bitcoin sport etf is accepted, i think thats generally a positive sign, um. The next one is stable coins and i also think this is positive. I think this year were going to get a lot of regulatory clarity over the crypto space, and i only see this as a long term. A good thing. We need regulation, otherwise it will always be a you know, wild west market, and if we truly want bitcoin crypto to become 10 50 trillion in you know multiple years time, then it needs to be regulated. The fed has already come out and said this. This is the board of governors of the fed, theyve, come out and said heres some areas that we need to regulate uh, the first one or theres a few here, but really the the one that im looking at is including stable coins.
Now circle maker of usdc went before the um went before congress, and basically it looks like theyre going to be one of the chosen partners for stable coins, which is a very good thing and stable coins for me, are positive. Stable queen regulation is positive for the price of bitcoin, because it just means that more uh more money can flow in and more money flowing in. You know its not its not going to just moon the price overnight, but its generally a good thing in the right step. The next is east 2.0. I see this as a positive generally for the space in many different ways: im not going to get into that. Now, because its very very complex, but ether 2.0 generally, i think, is a very good thing, for you know many other app apps as well and daps and and pretty much the space in general. So this could be a very big uh, key um uh like uh time for us and then rates of inflation. This is this is not good right, so what we have to see is: where is inflation? What is the fed going to do about that? Because, despite all of these three things that i think may be coming in 2022 and will be very positive for the price of crypto rates and inflation is really a massive cloud over absolutely everything and as youve just seen, bitcoin and therefore other cryptos will react most Strongly to what the fed is doing so thats, why i think cryptos are consolidating right now.
I think theres, just a huge amount of uncertainty about what inflation is and what the fed will do about that. We can also see that volumes are really low. So if we come over to exchanges right here and we see the spot exchanges, we can actually see that volumes are just starting to pick up, and this is a good sign. You know you need high volume to really show us where the price should be um. You can see across the board on spot exchanges were just seeing volumes start to come back in, so this is a good sign. Obviously, people are coming back to trade after the christmas break. Um, you know, and across indexes, and also derivatives as well, were just seeing um volumes just start up again after the break. So this is a very good thing, but theyre really things im, keeping an eye on the fundamentals, as you can see here, and really inflation as well um. So if you do want to enter the crypto giveaway uh go ahead and do that ill leave the link in the description giving away 10 000 bucks thanks to pioneers. You can check out a tutorial that i made for them in the description as well. Also for crypto course, members ive got over 30 videos coming to the crypto course that will be free for you, guys, um. If you want to check out my crypto course that will be linked in the description got 30 videos planned and more that are coming very soon.
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