Bitcoin and most of the major cryptocurrencies dropped again this Thursday alongside equities after the US reported that consumer price inflation for August came in hotter than expected, fuelling expectations for an aggressive interest-rate hike at the Federal Reserve’s September 20-21 meeting.

But where is the price of Bitcoin (BTC) going next, in the fourth quarter of 2022? Today, Crypto Lists will discuss Bitcoin price estimates for Q4, 2022 from a technical and fundamental analysis perspective. Please note that there are also many other factors to consider when entering a position, such as your time horizon, willingness to risk and how much margin you got if trading with leverage.

The signs of decelerating price pressures in July proved to be short-lived

The last several months have been extremely taff for the cryptocurrency market, and cryptocurrencies have been suffering from heavy selling due to hawkish signals from central banks and uncertainty because of the Ukraine crisis.

Bitcoin and most of the other major cryptocurrencies dropped this Tuesday again alongside equities after the US reported that consumer price inflation for August came in hotter-than-expected, fuelling expectations for an aggressive interest-rate hike at the Federal Reserve’s September 20-21 meeting. Will the FED raise 1% instead of 0.75% as initially expected? That can be dangerous for those long in BTC.

According to the Bureau of Labor Statistics, the consumer price index rose 0.1% in August (against the expectation of a 0.1% dip) following a flat reading in July, while the core inflation accelerated more than expected. On a year-on-year basis, the consumer price index increased by 8.3%, while economists were anticipating a rise of 8.1%, according to a Reuters poll. Shelter, food, and medical care were “the largest of many contributors to the broad-based” headline increase, and Morgan Stanley Chief US Economist Ellen Zentner wrote in a report:

“The August report clearly sends a hawkish message as the signs of decelerating price pressures in July proved to be short-lived. A 75 basis-point increase is likely for next week’s rate decision.”

No pause for FED

Federal Reserve Chair Jerome Powell also confirmed that the Federal Open Market Committee would not pause its campaign to bring price growth down, while Federal Reserve Bank of St. Louis President James Bullard said that he is open to the idea of another outsized interest-rate increase at the central bank’s meeting this month.

Investors are worried that an aggressive interest rate hike policy could trigger an even bigger sell-off, and in light of this, Bitcoin (BTC) might have a hard time holding above the $20000 level. It is important to mention that the cryptocurrency market is correlated with the stock market, and if a downtrend is witnessed in the stock market, the same is replicated in the crypto-sphere as well.

Analysts at Nomura Securities now believe that the Fed will go as far as announcing a 100-basis point hike, and according to them, market sentiment will stay overwhelmingly bearish in the fourth quarter.

Jeong Seok-moon, the head of South Korean exchange Korbit, said that crypto winter could end before the end of 2022, but he also thinks that the US Federal Reserve’s attempts to fight high inflation would continue to influence crypto markets in the meantime.

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Technical analysis for Bitcoin

After recovering in July, the price of Bitcoin dropped by roughly 15% in August. The current price stands above $20000 support, but a break below this level would indicate that Bitcoin could probably test the price level at $19000.

On the chart below, I marked the trendline, and as long the price of Bitcoin is below this trendline, we can’t talk about a trend reversal, and the price of BTC remains in the SELL-ZONE.

Bitcoin graph over bear market trend

Main support & resistance levels for Bitcoin

bitcoin support and resistance levels, Q3-Q4, 2022

On this chart (the period from January 2022), I marked the main support and resistance levels that can help traders to understand where the price could move. The more often price tests a level of resistance or support without breaking it, the stronger the area of resistance or support is. When the price passes through the resistance, that resistance could potentially become support. Bitcoin remains in the “bearish phase, “but if the price advances above $25000, it could be a sign of the trend reversal, and the next target could be located around $27000. The current support level is $20000, and if the price breaks this level, it would be a “SELL” signal, and we have the open way to $19000. If the price drops below $17500, which represents very strong support, the next target could be located around $15000. If the interest rates keep rising, and if the economy is starting to slow down into a deeper recession,

What speaks for the rise in the Bitcoin price

Bitcoin has surged more than 25% since the beginning of July, rising from $18960 to a high of $25212 reached on August 15. The sudden upswing took Bitcoin to test the $25000 level multiple times, but it did not show enough strength to stabilize above it. The current price stands above $20000 support, but a break below this level would indicate that Bitcoin could probably test the price level at $19000. Many surveys show that institutional investors still remain bearish on Bitcoin, especially because of the fact that the aggressive interest rate hike policy from the US central bank could trigger an even bigger sell-off. Bitcoin remains in the “bearish phase, “but if the price advances above $25000, it could be a sign of the trend reversal, and the next target could be located around $27000. It is important to mention that Bitcoin is usually correlated with the US stock market, and if an uptrend is witnessed in the stock market, the same is replicated in the crypto-sphere as well.

What indicates further downfall for Bitcoin

Bitcoin and most of the major cryptocurrencies dropped this Tuesday alongside equities after the US reported that consumer price inflation for August came in hotter than expected, fueling expectations for an aggressive interest-rate hike at the Federal Reserve’s September 20-21 meeting. The current BTC price stands above $20000 support, but a break below this level would indicate that Bitcoin could probably test the price level at $19000.

Bitcoin price expectations from analysts and experts

Bitcoin and most of the major cryptocurrencies dropped this Tuesday again after the US reported that consumer price inflation for August rose more than expected. According to the Bureau of Labor Statistics, the consumer price index rose 0.1% in August against the expectation of a 0.1% dip. Morgan Stanley Chief US Economist Ellen Zentner said that the signs of decelerating price pressures in July proved to be short-lived, and a 75 basis-point increase is likely for next week’s rate decision. Investors are worried that an aggressive interest rate hike policy could trigger an even bigger sell-off, and in light of this, Bitcoin (BTC) might have a hard time holding above the $20000 level. Analysts at Nomura Securities now believe that the Fed will go as far as announcing a 100-basis point hike, and according to them, market sentiment will stay overwhelmingly bearish in the fourth quarter.

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