Satoshi Act Fund CEO and founder Dennis Porter thinks bitcoin prices will go down “very, very low“. The crypto-currency market is crashing hard as the dollar continues to show extreme strength. Bitcoin has fallen nearly 6% in the last 24 hours and over 8% in the last 7 days.
Porter also reveals that many people around him believe that the current economic environment is the worst macroeconomic condition in a lifetime.
Dollar strength sinks bitcoin
The dollar continues to strengthen and has hit a new 20-year high. 10-year U.S. Treasuries also strengthened in anticipation of an aggressive Fed stance. The dollar’s rise sent the S&P 500 and the NASDAQ 100 lower. Bitcoin, which is highly correlated to technology stocks and the technology-based NASDAQ, also fell.
The dollar’s rally has shown no signs of slowing. A Bloomberg article points out that the Fed’s stance could become much more aggressive. It is believed that Fed Chairman Jerome Powell will follow in the footsteps of former Fed Chairman Paul Volcker. Volcker probably pushed the U.S. economy into recession by taking a hawkish stance on inflation.
If the Fed continues its quantitative tightening, the dollar may continue to make new highs. In his Jackson Hole speech, Jerome Powell reaffirmed his position to increase the strength of the dollar to help fight inflation. The Intercontinental Exchange dollar gauge points out that the dollar is still one-third lower than it was in 1985, under the Volcker regime.
A macro expert just told me, “I’ve never seen a worse macro economic outlook in my life.”
Does this mean we have bottomed?
– Dennis Porter (@Dennis_Porter_) September 7, 2022
How low can BTC go?
Experts believe that bitcoin’s dominance is currently at support levels. If BTC continues to fall, it could reach extremely low levels. Richard Heart, a major crypto influencer, believes bitcoin will fall to $11,000 before any upward movement.
All eyes are now on the September 13 CPI data release. Favorable CPI data may release the downward pressure of the Fed’s hawkish activity on Bitcoin and may lead to a BTC rally.