- The urgency around issuing new U.S. Treasuries has eased, dovish Fed signals and a softer labor market have laid the groundwork for looser monetary policy.
- Bitcoin has historically posted gains toward the end of the year.
- Leading growth in altcoins confirms rising risk appetite.
Recent macro shifts hint at a potential rally in the crypto markets. Higher beta in altcoins reinforces this signal, отметил Markus Thielen, head of research at Matrixport.
According to the expert, Bitcoin tends to rise on average by about 23% in the pre-Christmas period of November and December.
Thielen highlighted three events that reinforced the view that the Fed has peaked, paving the way for a strong rise in risk assets:
- The US Treasury’s reduced urgency in issuing securities — a signal of expectations for looser monetary policy;
- the dovish signals from Fed Chair Jerome Powell at the press conference following the November meeting;
- a disappointing U.S. nonfarm payrolls report that further reduced the odds of an additional rate hike.
Thielen noted that after the Fed ended its tightening cycle in January 2019, digital gold rose fivefold. He cautioned against expecting the same momentum, while also noting that Bitcoin could “move substantially” in 2023 and 2024.
An additional driver, in his view, could be the approval of a spot Bitcoin-ETF. The expert stressed that in 2017, when futures-based ETFs appeared, the price of digital gold remained overbought for a long time according to the RSI. For this reason, one should not count on a reduction in longs until these expectations materialize, he suggested.
Separately, the expert указал on a “strong tailwind of liquidity” that allowed Ethereum, XRP and Solana to display Bitcoin-leading momentum.
Thielen упомянул signs of increasing on-chain activity in the second-largest cryptocurrency. He believes this could indicate a potential bottom for its market value near $1,550.
The decline in Bitcoin’s dominance was accompanied by higher Ethereum trading volumes and greater funding rates on perpetual contracts, according to a Matrixport analyst.
«These factors, along with the Fear and Greed Index, point to growing trader confidence and potentially set the stage for higher price levels for cryptocurrencies as the year enters its final stretch, — Thielen concluded.
As Bitfinex analysts explained, bitcoin’s hold near $35,000 was due to expectations of a softer Fed policy.
CoinShares researchers arrived at the same conclusion. They estimate that inflows into crypto investment products from Oct. 28 to Nov. 3 reached $261 million, after a record $326 million the previous week in July 2022.