The fallout from the Ethereum merger is giving no rest to crypto bulls, who face continued market pressure as shares also trend lower.
Bitcoin (BTC) attempted to break local lows on Sept. 16 as the recent cross-crypto downtrend intensified.
Hourly candlestick chart BTC/USD (Bitstamp). Source: Trade View
No relief for BTC bulls after merger
Data from Cointelegraph Markets Pro and TradingView has shown that BTC/USD is nearing $19,600 at the time of writing, with buyer support just avoiding another drop.
The level stayed at an intraday low after the Ethereum merger completed, but only to trigger a sell-off that took Ether (ETH)/BTC near three-week lows.
ETH/BTC 1-day candlestick chart (Binance). Source: Trade View
Against the background of the depressed mood, traders and analysts showed little desire to revise their market assessments.
“I’m confident in the scenario of a quick pump to 23,000 in BTC and 1800 in ETH and a big dump from there,” Crypto’s Il Capo wrote, echoing a long-standing theory:
“We will see.”
Meanwhile, the popular CryptoBullet account warned that the situation is “not looking good” and called for a retracement of the 100-period moving average (MA) to reverse the uptrend on the 4-hour chart.
Fed rate hike will send stocks lower – Dalio
Meanwhile, after another day of losses in US stocks, investor Ray Dalio drew some fresh bearish conclusions on what the current inflationary climate will mean for markets.
Related: Ethereum Traders Cut ETH Price Record High During Confluence – 50% Crash Ahead?
In his most recent blog post, published on Sept. 13, Dalio predicted that the cumulative damage to the stock would cost it 30% of its current valuation.
“Rising interest rates will have two types of negative impacts on asset prices: 1) the present value discount rate and 2) lower asset returns due to a weaker economy. We need to look at each other,” he explained.
“What are your ratings for her? I estimate that raising interest rates from current levels to about 4.5% would have about a 20% negative impact on stock prices based on the discounted present value effect (on average, albeit more for longer-dated assets and less for shorter-dated assets ). and about 10 percent of the negative impact of lower incomes.”
This will pose a threat to the highly correlated cryptocurrency markets as Bitcoin is therefore targeting levels near $10,000.
As Cointelegraph reports, this figure is not alien to the radar of long-term forecasters right now.
According to the CME FedWatch Tool, the Federal Reserve intends to hike rates by another 75 basis points at next week’s Federal Open Market Committee (FOMC) meeting, with some market participants expecting as much as 100 basis points.
Fed interest rate target probability chart. Source: CME Group
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