Popular crypto analyst Nicholas Merten says that the price of digital assets will slide even further following Federal Reserve Chair Jerome Powell’s latest speech on the economy.
Amid the current downturn, Powell told central bankers on Friday that the Fed will get inflation under control by raising interest rates and keeping a tight monetary policy for some time.
In a new video update, the host of DataDash tells his 515,000 YouTube subscribers that Powell’s statements make him believe that crypto and other financial markets will see more losses.
“We have further conviction of a continued decline, not only from the short-term correction here on August 15th, but in the broader bear market correction following the recent speech from Jerome Powell, from the Federal Reserve, further solidifying harsher monetary policy and therefore setting in a rocky environment for assets abroad.”
However, Merten says that the Federal Reserve is doing what they’re supposed to be doing by curbing inflation, even if it hurts the markets in the short term.
“I gotta be honest, I know a lot of us have a negative opinion of the Federal Reserve, but the Fed is doing exactly what it needs to do from a monetary policy perspective. It is increasing interest rates, it is considering and already beginning slight reductions of its balance, in fact, I would say that a shock and awe of a 100 point basis point hike would probably be the best thing the FED could do…
“It would best to be a shock and awe, basically put the economy in a temporary dip, cool consumer demand in the short term and bring us back to equillibrium.”
The analyst says that the price dip caused by the Fed’s actions would give investors an opportunity to buy crypto at a discount as Bitcoin (BTC) and Ethereum (ETH) could dip lower than their lows during the latest crypto bear market.
“The good news is we’ve at least got a minimum chance to likely see Bitcoin and Ethereum, and a variety of assets, come back down towards their bear market lows, potentially even lower giving us some really great entry points.”
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