Notes

Wall St Week Ahead Crypto investors are facing more uncertainty following a turbulent start to 2022


Investors are preparing for further gyrations in bitcoin and other cryptocurrencies, amid concerns that the aggressiveness of the Federal Reserve threaten to squelch risk appetite across markets.



The usual volatility that is characteristic of cryptocurrency has been all over the news over the past few weeks. Bitcoin is the biggest cryptocurrency, has increased by around 33% over the course of Jan. 24. It has been trading at $43,850. It's rebounding from an ebb that cut its price by half from its record peak. Its major rival, ether , is up around 45percent from Jan. 24, at about $3,200 and has seen a nearly 56 percent drop from its record high of $4,868, during November.








While proponents of cryptocurrencies once asserted that they are not tied to other assets the bitcoin market and its competitors witnessed huge gains over two years that followed, rising alongside stocks as the Fed and central bankers pumped enormous amounts of stimulus into the world economy. Bitcoin has increased by 1,039 percent since March 2020, and Ethereum has grown by 2,940%. However, royal q robot images in both of them has been marred by numerous stomach churning sales.








The recent volatility in the market has come amid a broader price decline driven by investors recalibrating their portfolios to account for a more aggressive Fed, which is now expected to raise rates 7 times this year while it combats a rising rate of inflation. The index that is the benchmark S&P 500 index (.SPX) has dropped 5.5% year-to-date, while the high-tech Nasdaq (.IXIC) has lost 9.3 percent..



Insecurity that a rapid Central Bank tightening process going forward will be a savage blow to the risky assets have made it difficult for traders to maintain their bullish view on bitcoin and other cryptocurrency the asset class recognized as having a high degree of volatility.








Tensions are rising in Ukraine in Ukraine, where Washington warned that a Russian invasion could occur any day, could also trigger market movements across the board Investors said. Find out more



Bitcoin can "really become the most powerful trading platform and there are numerous risks that could cause a 40% drop completely out of the blue," said Ed Moya the senior analyst at Oanda.



The volatility of Bitcoin hasn't stopped experts from trying to assess the currency's fair value or point out potentially important price points.



Analysts at JPMorgan estimate bitcoin's current worth at $38,000 , which is about 15% less than its current price , based upon its volatile nature in comparison to that of gold, another asset commonly used by investors to hedge their portfolios against inflation and economic uncertainty.



Vanda Research, meanwhile, stated in a recent report that most of the bearish bets placed on a weaker bitcoin price were placed at about $47,000 "there might be a massive short-squeeze if this threshold is crossed and retail investors are reintroduced for crypto-trading."



In addition, the correlations between bitcoin and the S&P500 reached an all time high on Jan 31, as per research obtained from BofA Global Research, undercutting some of the arguments made by those hoping to take advantage of the cryptocurrency as an instrument to hedge against market volatility.



Investors in the coming week can expect minutes of the Fed's recent financial policy meeting due to be released on Wednesday. Walmart (WMT.N) along with chip maker Nvidia Corp (NVDA.O) will be among the companies that will release results, as corporate earnings season kicks off.



Some investors are making plans to take advantage of the volatility of bitcoin, hoping on the long-term viability of blockchain technology, its built in supply limit, and the effect that it creates, will last despite the constant price swings.



Jurrien Timmer director of global macro at Fidelity and Fidelity, compared the current speculation in cryptocurrencies to the volatile tech stocks that were experiencing during the dotcom period more than two decades ago. It was a boom-and-bust period that saw a comparatively small group of companies surviving.



"Amazon is still in existence and Apple continues to exist and they're both bigger than ever. it's believed that for bitcoin it's going to be the same," says the expert. "But bitcoin isn' make money covid testing to the waves of speculation and sentiment."



Bitcoin could reach 100,000 by 2023. Timmer told me, according to his supply/demand model.



Others believe that mature cryptocurrencies such as bitcoin and ether have a low chance to make the amazing gains they have seen since their founding.



Instead, they are turning to the world of emerging alternative coins being made to make the most of the wealth flowing into the crypto space, including the metaverse and NFTs that saw 30 billion dollars worth of venture capital investments this year, as per PitchBook.




A few altcoins are cosmos Terra Luna, and Polkadot that are all down by 20.5 percent three times, and 25.5% year-to-date, respectively, According to coinmarketcap.com.



Understanding the risks related to their decentralized nature and financial systems is likely to be one of the biggest challenges facing investors in 2022, according to Lily Francus, director of quantitative research strategy at Moody's Analytics.




Cryptocurrencies "are going to be extremely uncertain in the future, yet there are significant players both on the institutional and retail side that are growing, meaning that interest continues to grow," said Oanda's Moya.




Homepage: http://bvkrongbong.com/Default.aspx?tabid=120&ch=419807