FX.co ★ Fed minutes: no hope for Bitcoin's growth in the near future

Bitcoin stays flat below the $18,500 level. Recall that this is exactly the scenario that I have mentioned many times, so everything is going according to plan. Now Bitcoin may be flat for a few more weeks or months, but in the end I expect it to fall at least to $12,426.

The minutes of the Federal Reserve's December meeting were released last night. I deliberately did not focus on this event as these documents rarely contain information unknown to the market. This time it was exactly the same, so even the currency pairs did not react to this report. Nevertheless, take note that the nature of the minutes was hawkish. Most of the Fed's Monetary Committee members are not expecting a key rate cut in 2023, which means it will grow even higher (to 5.25-5.5%) and stay like that for at least 9 months. The current rate is 4.5%, and the markets are expecting at least 2-3 more rate hikes. The first cut may take place in 2024 when inflation is expected to return to 2%. Thus, further tightening of monetary policy and then keeping it at that level for a long time is what the cryptocurrency industry is waiting for in 2023. I believe that the "Fed factor" can be considered as one of the most global factors affecting the mood of crypto traders. At this time, it is still much more profitable to buy long-term Treasury bonds or keep money in bank deposits. Investing in Bitcoin, which many disinterested experts believe will continue to fall, simply does not make sense. Thus, I do not expect the world's first cryptocurrency to strengthen in the coming months as the Fed rate continues to rise.

Remember that considering long positions when the fundamental background is negative would require technical signals, which are not present right now. At this time there is no reason to open longs. Of course, if you are an institutional investor and can afford to sit out any drawdown, then you can buy Bitcoin now and wait for a bullish trend for years. But most of the people gathered here are private traders who can't afford to do that. Hence, you have to wait for a favorable fundamental background or technical signals to buy.

On the 24-hour chart, quotes remain below the level of $18,500. In my point of view, Bitcoin may continue to fall towards the $12,426 target. However, it might not happen anytime soon because each new fall was followed by a flat period, which we are witnessing now. But that does not mean that the bearish trend is over.