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While Bitcoin takes a dip with the rising bond yields, analysts still remain hopeful that BTC price is all poised to surge from the current levels.
The 10-year US Treasury Yield has once again put volatile asset classes like Bitcoin (BTC) under pressure. On Wednesday, March 16, the US Treasury Yield surged to 1.67% hitting its 13-month high. The recent surge comes just two days ahead of the press release of Federal Reserve Chairman Jerome Powell.
However, this has put the BTC/USD trading pair under severe pressure. As per the recent Bitcoin chart on Trading View, BTC price dipped further today moving closer to $53,000. However, it has pulled back very quickly from the lows and at press time, it is trading around $55K levels.
Coming back to the US Treasury Yield, the 10-year yield has hit a high of 1.67%, the levels seen for the first time since February 6, 2020. The Fed will soon release the new economic and interest rates forecasts ahead this week. However, the Fed officials expect to increase the interest rates either by 2023 or even before that.
It is not sure whether if the Fed would step in to suppress the rising bond yields at these levels. Starting 2021, the 10-year Treasury yields were just at 0.9% and has nearly doubled so far.
Speaking to CNBC, Ian Shepherdson, chief economist at Pantheon Macroeconomics, said that Federal Reserve chairman Jerome Powell would again push back on some of the inflation fears. Shepherdson thinks that in Wednesday’s press conference Powell wouldn’t talk anything about tapering its bond-buying program. He added:
“As soon as the Fed starts talking about tapering, then yields will rocket immediately because that’s what markets do — you give markets an inch and they take a yard — especially in Treasuries at moment. So the Fed therefore I think wants to keep this talk really dampened down as much as they possibly can until they can’t”.
Analysts Remain Positive about Bitcoin amid Treasury Yield Growth
While Bitcoin has corrected 10% from its all-time high last Saturday, it is still trading at $55K levels as of now. On-chain metric and analysts are hopeful that Bitcoin can surge further from the current levels. As the on-chain metrics are showing strength, the derivatives funding rates have also cooled showing bullish sentiment beyond the spot price action.
During his recent YouTube update, popular trader Scott Milker added:
“Bitcoin will continue to rise and rise in the foreseeable future — we don’t need charts or technical analysis to tell us what is painfully obvious. People are increasingly interested in buying Bitcoin as a hedge against central bank behavior and infinite money-printing, while at the same time, supply is rapidly exiting the market.”
On the other hand, Wall Street veteran and Galaxy Digital founder Mike Novogratz also said that he has been buying Bitcoin at the current levels.