FX.co ★ Latest crypto news on November 17

Markets doubt BTC can grow further

On Tuesday, November 16, bitcoin dropped by about $5,000. However, the current wave pattern for BTC suggests that any scenario is possible now, even the one in which the formation of the uptrend is completed. But let us talk about the wave patterns a bit later. I have recently noticed that in the past few weeks the market is no longer actively buying bitcoin. According to some respected analysts, the launch of the world's first bitcoin ETF did not prompt the demand for bitcoin itself, but only for ETF stocks and bitcoin futures. In addition, bitcoin is now holding near its historic highs, and new purchases are always risky at such levels. Also, the market is certainly worried about high inflation in the US and, accordingly, the tightening of the Fed's monetary policy. At first, the Fed was planning a gradual tightening. Yet, inflation is not going to adjust to the plans of the American regulator and continues to grow. The US central bank, in turn, can accelerate the cutting of the QE program and start a rate hike earlier than in mid-2022. These worries may hold back bitcoin's uptrend since they serve as a bearish factor for BTC.

Evergrande's collapse threatens bitcoin and other markets

At the same time, the whole world has been closely following the situation around the Chinese developer (one of the largest in the country) Evergrande for several months in a row. The company is on the verge of bankruptcy and could have declared it at least three times. But every time the developer has managed to do something to postpone the collapse. However, the German Market Screening Agency may recognize the company as a default in the coming days. This will result in the non-payment of about 2 trillion yuan on the company's liabilities. Notably, 2 trillion yuan is 2% of China's GDP which is definitely a huge amount. There is no doubt that the bankruptcy of Evergrande will drag many companies down and trigger a wave of bankruptcies around the world. Along with this collapse, markets will tumble as well as everything has been closely connected for a long time. As such, bitcoin could be severely shocked by the Evergrande's crash, and not only bitcoin. It is reported that by the end of the year, the company must pay about $340 million and $7.4 billion next year.

Meanwhile, the current ascending section of the trend is still valid. The wave pattern was clarified after the instrument made a successful attempt to break through the high of the assumed wave 3. Now the whole picture looks like an impulse five-wave uptrend section which began its formation on July 20. However, retreating from the highs reached lately may also mean the completion of the expected wave 5 which in this case turned out to have a shorter layout. It is also possible that we will see the construction of the assumed wave C in 4. But for now, everything looks more like the completion of a five-wave ascending wave structure. Thus, in the coming weeks, bitcoin is at risk of initiating a new downtrend section which could persist for several months. This means that BTC is unlikely to reach the long-awaited target of $100,000 this year. Also, the cryptocurrency may drop to at least $44,000 or even lower in case the news background is bad in the coming weeks.