Bitcoin Nears $16000 As Powell Rates Remain Low: Price Analysis

Bitcoin nears $16000 as traders assessed a new combination of supportive macro catalysts as we are reading more in today’s bitcoin news.

One of them was the Federal Open Market committees’ November meeting as the chairman Jerome Powell reiterated that the worsening COVID-19 pandemic poses extreme risks for the US economy. He expressed concerns about the exhaustion for the American households’ savings after the dissolution of earlier relief measures.

Powell pledged to keep supporting the economy by trying to maintain the benchmark interest rates near zero for about three years. In the meantime, he proposed to make upwards adjustments in the FED’s asset purchasing program and the bank now buys $120 billion worth of Treasury and mortgage-backed securities. The statements stressed the US dollar as the greenback fell to 0.94 percent as talks of central banks’ spending only poses risks of hurting the purchasing power. Its dip prompted investors to look for opportunities somewhere else with Bitcoin emerging as an ideal candidate thanks to the consistent uptrend since the previous two weeks.

The cryptocurrency jumped by about 18 percent after PayPal’s foray into crypto. After that, the US presidential election uncertainty followed with the prospects of Joe Biden winning against Donald Trump which also helped to extend the bull run further. As earlier reported, the Democratic nominee promised his voters/traders that he will boost government spending to aid them after the pandemic ends. Investors anticipated that Mr. Biden as the next US president will unveil a gracious stimulus package which is worth trillion.
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Mr. Powell also stressed out the need for a broader fiscal relief in order to mitigate coronavirus impact on the Americans adding that it will further help to avoid bankruptcies and long-term labor market damage:

 “We’ll have a stronger recovery if we can just get at least some more fiscal support, when it’s appropriate and at the size Congress thinks is appropriate.”

The fresh dollar liquidity into the US economy will limit the appeal as safe-haven as it has already happened after the March 2020 stimulus package. This reveals why Bitcoin surged right after the FOMC meeting hit the wires. Now as Bitcoin nears $16000, market analyst Parabolic Thies says that the cryptocurrency could risk correcting by at least 30 percent during its bull run:

 ‘I expect Bitcoin will return to all-time highs by January 2021. The craziness of a bull run ensues thereafter.”