Why the End of QT Does Not Mean an Immediate Pump for the Market
Hello everyone,
How are you all? I hope everyone is fine doing great in their life.
The month of December has already started and for those who do not know, the quantitative tightening ends today officially in America. While this is good news for all of us, we should not expect an immediate surge in the market after this news.
The reason is simple. In 2019 when quantitative tightening ended, the market took a few months to understand the situation and we even saw a dump of around 30% in the entire crypto market.
So even though the ending of quantitative tightening is a positive sign, what really matters is quantitative easing. The ending of quantitative tightening does not mean that quantitative easing will start immediately.
It can take a few months before quantitative easing begins and even after that we do not know if the market will behave the same way it did in the last cycle.
If it takes longer to start quantitative easing, people will move their money to safer assets and that will increase the price of gold, silver, and other commodities that are considered safe. The assets that will be affected the most are digital assets and one of them is cryptocurrencies.
Through this blog I want to tell everyone that you should not expect a market pump after quantitative tightening ends today because history shows that the market does not respond immediately.
Even today we saw that the market crashed by 4000 to 5000 USD for Bitcoin and many people were not expecting this because most people on social media are busy posting how the market will do a 2x from here. But believe me it is not easy for Bitcoin to do a 2x from the current position. The market is mature and it cannot simply jump that much right now.
I do not think a 2x move is possible for Bitcoin in this cycle. The maximum target I see is between the recent all time high and around 130000 to 140000 USD, and even that is not guaranteed.
The main thing we should look at right now is whether Bitcoin can consolidate in the current support and resistance zone. That is the most important thing. I have said many times in my blogs that Bitcoin will not go straight up. It also cannot move sideways for too long because that is not healthy for the market.
It is good that we tested the 92000 to 93000 USD area and now we are back to around 87000 USD where I think we might stay for a few days and then maybe push higher. Only time will tell what the market is going to do.
Thank You and make sure to check Crypto Company CEO services as I recently shared in my blog. You can simply click on the picture below and it will take you to their official website.
