Bitcoin Dips Amid Fed Rate Cut; Analysts Weigh Volatility and 'Buy-the-Dip' Potential
December 20, 2024Experts recommend holding assets as the market may rebound with new ETFs potentially entering the market soon.
Despite the recent downturn, analysts describe the market correction as orderly, with no signs of panic, indicating potential for 'buy-the-dip' behaviors among investors.
Investors are closely monitoring various economic indicators, including new passenger car registration data in Europe and Spain's trade figures, to assess the region's economic health.
Amazon shares rose by 2.2%, even amidst ongoing strikes at several facilities, which the company claims will not disrupt operations during the peak sales season.
Bitcoin's price dropped by 4.6% to $101,300 following the Federal Reserve's recent 25 basis point rate cut and a hawkish outlook for 2025.
Despite positive developments in the market, analysts express caution regarding potential volatility due to ongoing external economic pressures.
Market discussions are centered on understanding sharp reactions and strategies for portfolio construction amidst concentrated markets and macroeconomic uncertainties.
Experts advise maintaining discipline and patience in investment strategies to avoid impulsive decisions during periods of volatility.
Analysts warn that despite early gains, investors may pull back their exposure as the weekend approaches, potentially reversing gains later in the day.
The MVRV Ratio, which indicates unrealized profitability, currently hovers around 3, suggesting there is still room for growth before reaching historically overheated levels.
Market sentiment remains bullish, with expectations of continued activity and rising prices attracting new participants over the past two months.
Analyst Percival noted that long-term holders have likely realized most profits and are positioned for further price increases.
Summary based on 506 sources
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Sources
The New York Times • Dec 18, 2024
How Fed Rates Influence Mortgages, Credit Cards, Savings and MoreForbes • Dec 21, 2024
Bitcoin Suddenly Surges Back To $100,00 On Huge $20 Trillion Price PredictionForbes • Dec 21, 2024
Bitcoin Prices Reached A Fresh Zenith This Week As Multiple Factors Fueled Gains