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The banking crisis has loomed over the US – what it means for Bitcoin

Cryptodnes2024/06/07 07:49
By:Cryptodnes

Real Vision analyst Jamie Coates claims that an important Bitcoin indicator is now showing a bullish signal amid fears of another US banking crisis.

The former Bloomberg analyst share with his on X (Twitter) that macroeconomic conditions may soon push the value of BTC up:

The Federal Deposit Insurance Corporation (FDIC) has highlighted that 63 US banks are close to bankruptcy. This is due to the fact that these banks hold $517 billion in unrealized losses. Meanwhile, after some steady price movement since March, my direct Bitcoin trend model indicates a bullish signal. With the DXY down, lower yields and corporate spreads, can you feel it? This is the aroma of central bank liquidity in the air.

Coates appears to be using a combination of moving averages, the win-loss metric, and the Slope indicator.

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The analyst suggested that volatility in the banking sector could prompt the Federal Reserve to inject liquidity into the markets, which he said would be favorable for Bitcoin .

In its May 29 quarterly bank profile report, the FDIC noted that banks are saddled with more than half a trillion dollars in paper losses on their balance sheets, largely due to their exposure to the housing market.

Unrealized losses represent the difference between the purchase price of the securities and their current market value. These losses can become a serious liability when banks need liquidity.

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While the FDIC said the U.S. banking system was not in immediate danger, it warned that continued inflation, volatile market rates and geopolitical issues continued to create pressure on the sector.

At the time of writing, Bitcoin is trading at $71,103, up 2.5% over the past 24 hours.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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