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On Tuesday, there was cautious optimism in the cryptocurrency market ahead of the annual meeting of the world’s central banks, known as the Jackson Hole Symposium.
The symposium is due to begin in Wyoming this Thursday, where U.S. Federal Reserve Chairman Jerome Powell will deliver a speech on the economic outlook and interest rate policy.
Coinbase’s head of institutional research, David Duong, expects Powell to take a more measured stance and stress that the tightening cycle is not over yet.
The expert believes that in the short term, bitcoin may face difficulties, as the current picture of technical analysis indicates an increase in bearish sentiment.
In the next few weeks, BTC is likely to retest support at $20,830 and $19,230, Duong wrote.
A similar opinion is shared by analysts of the Singapore-based cryptocurrency trading company QCP Capital, who stated that “Fed officials are actively resisting the dovish narrative in the market.”
Other market participants, such as Mott Capital Management founder Michael Kramer, by contrast, believe Powell will signal a rate hike, albeit at a slower pace.
He added that Powell “needs to make it clear that there will be no rate cuts in the future until it becomes clear that inflation is on a downward trajectory.”
Meanwhile, the U.S. stock market has begun to feel capital inflows again after the departure of many investors in early summer, according to the Wall Street Journal.
The report cites data from financial research firm Refinitiv Lipper, which says that over the past two weeks, investors have invested $ 11.7 billion in mutual and exchange-traded funds (ETFs), corporate earnings were also higher than expected, and inflation in the United States fell from highs, which potentially reduces the risk of aggressive rate hikes.
Given the correlation of the crypto market with the stock market, a trend towards recovery is also expected in the digital asset market.
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