Market Report December 2022
Macroeconomics events
December 2022 was a pretty indecisive month for private investors as they tried to decipher Powell’s messages regarding their economical expectations and the next steps, but they failed, as always.
This month Jerome showed everyone that he is still the best at what he’s doing - he has been talking a lot while saying very little. No matter how hard the public tries to extract any useful information from him, the man is still undefeated and retaining his title as the grandmaster of “Fedspeak”.
Thereby, all we’ve got to work with this time around is key economical data prints and Powell’s tight commentaries.
After all, absence of information is also a signal.
Key takeaways from the Fed in december:
The final terminal rate is still up to a debate.
There is no clear indication that the economy is heading towards the destination desired by the FED.
Nothing clearly says that the rate hikes should or would be paused in the nearest future, or “higher for longer”.
This month Jerome showed everyone that he is still the best at what he’s doing - he has been talking a lot while saying very little. No matter how hard the public tries to extract any useful information from him, the man is still undefeated and retaining his title as the grandmaster of “Fedspeak”.
Thereby, all we’ve got to work with this time around is key economical data prints and Powell’s tight commentaries.
After all, absence of information is also a signal.
Key takeaways from the Fed in december:
The final terminal rate is still up to a debate.
There is no clear indication that the economy is heading towards the destination desired by the FED.
Nothing clearly says that the rate hikes should or would be paused in the nearest future, or “higher for longer”.
Even though there have been two consecutive declining core inflation prints in a row, the market’s reaction was particularly short-lived as investors get better and better at forecasting such things.
Crypto market
Broad picture
The crypto market had a really tough time last month, with many major coins experiencing astonishing declines. However, things seemed to be stabilizing in December, with the market trying to find its footing after the crisis. Despite the volatility of the previous month, the market appeared to be consolidating, with most coins experiencing relatively small price movements and Bitcoin’s volatility heading towards a new All-time-low.
There were no major events that took place in December that could have had a significant impact on the crypto market. Some investors and analysts attributed this stability to the market's maturity, but in reality it's a typical thing to observe after such a powerful marketwide shock.
There were no major events that took place in December that could have had a significant impact on the crypto market. Some investors and analysts attributed this stability to the market's maturity, but in reality it's a typical thing to observe after such a powerful marketwide shock.
Market structure
Bitcoin has been ranging in a very tight structure with just 11% monthly spread, only two noticeable price impulses and consistently low trading volume.
The market still pays fair attention to our support zone around $16k we outlined in October.
Safe to say pretty much nobody is interested in trading current price levels. Investors want to see Bitcoin either at $19k to play some downside or the next historically significant support zone - at $12k which we also have marked.
The market still pays fair attention to our support zone around $16k we outlined in October.
Safe to say pretty much nobody is interested in trading current price levels. Investors want to see Bitcoin either at $19k to play some downside or the next historically significant support zone - at $12k which we also have marked.
Sentiment
This month is painted with insignificance and apathy amongst the crypto investors - which is, in a longer term, some of the key components in order to restart the game once again.
Interestingly enough, market sentiment has an even tighter range than the price of bitcoin itself. “It cannot get any worse”.
Featured technical tool - Support and resistance levels\zones
Support and resistance(or S\R levels) is a very basic, but a vital tool in the kit of any trader or investor. S\R zones, if used correctly, provide an invaluable insight into the points where buyers or sellers are interested in doing their business.
The key requirement to drawing accurate support and resistance levels is a clear and consistent price reaction at a specific level. A well-defined support and resistance level should be based on multiple price touchpoints. As simple as that.
In cases where your level isn’t clear enough, you can keep adjusting it until it becomes synchronized with price movements, and then utilize it to your benefit.
The key requirement to drawing accurate support and resistance levels is a clear and consistent price reaction at a specific level. A well-defined support and resistance level should be based on multiple price touchpoints. As simple as that.
In cases where your level isn’t clear enough, you can keep adjusting it until it becomes synchronized with price movements, and then utilize it to your benefit.
BitOK team commentary:
2022 has been very harsh to our beloved cryptocurrency market. That is the price we have to pay for harvesting enormous profits during the most recent bull market.
Market Cycles are called cycles for a reason - eventually the contagion plays out, bad attitude wears off and crypto begins a brand new uptrend like nothing happened.
Market Cycles are called cycles for a reason - eventually the contagion plays out, bad attitude wears off and crypto begins a brand new uptrend like nothing happened.
“During 2022 if you sat still with your cash portfolio and did nothing, you outperformed 90% of all investors around the world. The question is, can you remain seated until the better times?”
telegram: @DormantMind
telegram: @DormantMind
