Altcoins
Altcoin Lower Forecast by Analyst Amid Leading Economic Indicators: Report
Michael van de Poppe, a popular crypto analyst, recently gave his views on altcoins. suggesting that a bottom can form. This forecast comes at a time when the market is preparing for a crucial day for very important macroeconomic indicators, starting with the Consumer Price Index (CPI), the Federal Open Market Committee (FOMC) and the today’s Federal Reserve interest rate decision.
Van de Poppe emphasizes that these functions are crucial to changing the situation in the altcoin market. In the past, expectations of such events have negatively impacted cryptos, especially alts and especially when it comes to the leading crypto – Bitcoin. Additionally, recently, the corrections after the Roaring Kitty event and last week’s GameStop decline are not suited to price action.
However, the analyst highlights a recurring trend compared to previous FOMC Meetings: it revealed that market lows often occurring mid-week exhibited a strong rebound in the following days of the week. Most important to note, looking at previous FOMC meetings, Bitcoin and altcoin surged over 10% and 20%, respectively, after they both pulled back.
CPI Data Release Poised to Impact Altcoin Market
CPI data, forecast for release at 2:30 p.m. CET or the Core Consumer Price Index, the FOMC uses it to determine inflation and necessary interest rate adjustments. In the recent past, inflation rates have been higher than the projected average, with April CPI inflation at 3.5%. This is despite the fact that only 3.4% is expected to increase by this percentage, as previously reported. This is persistent inflation that is contrary to statements made by Federal Reserve Chairman Jerome Powell regarding sticky inflation.
Some of them are the expected annual increases, among which the year-on-year CPI is expected to reach the value of 3.4%, and the Monthly CPI (MoM) at 0.1%, the basic YoY CPI year-on-year is 3.5% while the year-on-year core CPI is 3.5% while the year-on-year core CPI is expected to reach the value of 3.4%. The CPI Y/Y was set at 1.3%. If actual numbers are in line with or below these expectations, a favorable market reaction is expected.
FOMC decision and Powell speech
The second major event of the day is the FOMC interest rate decision at 20:09:00 GMT, this is lowered by ISDA, then Powell’s speech at 20:30 CET. The recent rate cut by the European Central Bank, the first since 2019, raises the possibility that the United States will do the same, based on current CPI data. A inflation rate an amount higher than estimated could contribute to a rise in the dollar and yields, reducing the prospects of rate cuts in the near future and hurting risky assets such as crypto.
Cryptocurrency price movements in the altcoin and crypto markets have seen recent fluctuations based on a negative correlation between FOMC meetings and CPI data that could pivot soon. The analyst predicts a potential upward price revision this afternoon, based on the assumption that if the FOMC expresses itself in a dovish manner, Bitcoin should soon reach new highs.
The analyst frowns on the use of trading during this volatile time and recommends watching the reactions of gold, dollar and Treasury yields to today’s data. According to Van de Poppe, the dollar and yields will continue to fall, paving the way for higher altcoin and crypto markets. To their advantage, this may lead to the approval of The Ethereum ETF pushing the price to a record high before summer.