The market is now heavily pricing in a Fed hike. At the same time, the CLARITY Act has been one of the bigger potential regulatory catalysts for crypto in the US.
Say we get:
– CLARITY Act stalls/fails
– Fed hikes 25bps
– Fed stays hawkish and signals another hike later this year
– Treasury yields stay elevated
– Dollar continues strengthening
– Inflation remains sticky
Would you consider the current BTC rally a potential local top?
I’m not necessarily saying BTC enters a full bear market, because global liquidity still looks supportive and a 25bps hike is already largely priced in.
But if the regulatory catalyst disappears and markets start pricing a genuine Fed hiking cycle rather than just one hike, I could see BTC having a much deeper correction and potentially testing the yearly lows again.
On the other hand, if the Fed hikes once and then becomes more cautious/dovish, maybe the hike ends up being a sell-the-rumour/buy-the-news event and BTC keeps trending higher.
submitted by /u/SerenityCerulean
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