by Nayab Fatima
The Federal Open Market Committee meeting gave a Bitcoin whale the opportunity to earn $9.4 million by ending a sizable short position. The business bet on Bitcoin fell after CPI showed milder inflation numbers.
The anonymous investor created $368 million worth of short positions at Bitcoin value $84,043 before increasing the bet to $516 million using 6,210 BTC. The Ethereum trader had to sell their Bitcoin right away if the digital currency rose above $85,592. Although traders can make high returns with leverage their investments hold substantial danger including larger loss potential.
Whale Closes Massive Short Position
Hypurrscan shows this whale completed all its short activities in a short time period through trades that produced $9.46 million benefits. A team of market participants tried to make the trader lose his position by raising Bitcoin’s value. To keep his investment active the trader had to place another $5 million.
Their strategic maneuver failed and the whale escaped their market activity with profits. After successfully completing the short trade the trader invested all profits into buying 3200 ETH with a value of $6.1 million based on Etherscan records. The trader shows possible market neutralization and prepares against potential Bitcoin volatility ahead of the FOMC meeting in March 19.
The upcoming FOMC meeting will reveal important details about how Federal Reserve will manage monetary policy until 2025. Official data showed CPI inflation rose 2.8% across a twelve-month period in February compared to predictions of 2.9%. The easing inflation rate helps investors become more confident in high-risk assets including Bitcoin.
Bitcoin’s Key Support Levels Watch
The Fed will base their upcoming decision on this new data analysis. Bitcoin will move ahead mainly due to its ability to maintain $81,000 market floor support resistance. Our analysis shows that maintaining the $81,000 support level could help Bitcoin recover from its dip according to Fumihiro Arasawa the CEO of xWIN Research.
The FedWatch tool from CME Group shows that financial markets believe the Federal Reserve with near certainty will keep its existing interest rates. Investors expect Bitcoin market value to drop when the Fed announces unexpected rate increases. Adviser Ryan Lee of Bitget Research explains investors hope the Federal Reserve will not hike interest rates but market surprises will weaken risk assets including Bitcoin.
Bitcoin traders expect market fluctuations because the major whale pulled out their short position before the Federal Open Market Committee announcement. When the Fed reveals a friendlier monetary policy Bitcoin tends to strengthen its upward price direction. A swift enhancement of monetary policy will lead to market crashes.
Watchers of cryptocurrency markets focus completely on the Federal Reserve’s monetary policies because they direct crypto market performance. The FOMC meeting results and market emotions during the next few days will determine if Bitcoin will continue static or decline further.
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