Asia markets feel the heat as Fed rate-hike bets gain steam
Growing Fed rate hike bets rocked Asian markets, with JGB yields rising, yen near 160, and bitcoin below $69,000.
Bitcoin edges lower as traders await US CPI data, with Fed's Waller hinting at a potential 50 bps rate hike.
Bitcoin received some support on Monday as positive risk sentiment grew on hopes that the US and Iran could reach a diplomatic agreement.
Reports indicated that meetings between US President Donald Trump, Vice President J.D. Vance and Qatar's prime minister were constructive, with discussions focusing on advancing talks with Iran. Trump stated after his meeting with the Qatari premier that Qatar would prefer a peaceful resolution with Iran, though the US is prepared to launch strikes if needed.
Additionally, the US has permitted a limited level of uranium enrichment inside Iran, a step Tehran has accepted, and a preliminary accord on reducing enrichment appears likely.
Tuesday's focus turns to the US CPI release. Year-over-year figures will not be available due to last year's government shutdown. Weak data would not alter the outlook, as Federal Reserve Governor Christopher Waller indicated he would back a rate hike in December even if the CPI improves versus September.
Traders will monitor whether the month-over-month core CPI comes in at 0.3% or higher, because Waller said he would favour a larger 0.5% hike under that scenario. Waller is a highly influential Fed governor and has served as a reliable signal for Fed policy since 2021, making his views closely watched by markets.
A more hawkish Fed combined with no end to the Iran conflict would weigh heavily on growth projections and bitcoin.
On the daily chart, bitcoin is nearing the major upward trendline. If the price reaches that level, buyers are expected to lean on the trendline with a defined risk below it, aiming for a rally toward the 98,000 level with the downward trendline as the initial target. Sellers, meanwhile, would want to see a breakdown to increase bearish bets toward the 67,000 level next.
On the 4-hour chart, a minor resistance zone exists around the 76,000 level, where the price has been rejected several times over recent weeks. If a pullback occurs, sellers are expected to step in around that resistance with a defined risk above it, continuing to target the major upward trendline. Buyers, on the other hand, will seek a break higher to extend the pullback toward the downward trendline next.
On the 1-hour chart, little additional insight is available: sellers have a better risk-to-reward setup around the resistance, while buyers will look for a break above resistance or a bounce near the major upward trendline. The red lines mark the average daily range for today.
Today the US CPI report is due. Tomorrow, the latest US Jobless Claims data will be released. On Friday, the week concludes with the US PPI figures.
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Disclaimer: this article comes from third-party media and is provided for reference only. It does not constitute investment advice. Crypto and other financial products carry significant price volatility risk, so please make your own decisions carefully.
Growing Fed rate hike bets rocked Asian markets, with JGB yields rising, yen near 160, and bitcoin below $69,000.
Treasury yields climbed back to multi-year highs this week, reviving fears of sticky inflation and fiscal deficits that had been pushed aside.
New York Fed President John Williams said inflation remains too high and the Fed needs to tighten further, supporting expectations for a December rate hike.
Bitcoin traded near $71,200 after hitting a fresh session low of $71,000, as the 10-year yield stayed above 5% and stocks dipped.