The crypto markets performed exceptionally well during the Q4 of 2021 as Bitcoin, and Ethereum geared up for a rally. The positive momentum kickstarted in October and the majority of cryptos hit their all-time high in November last year. Q4 is generally known as ‘Uptober’ and ‘Moonvember’ (indicating that October and November) are the best period for cryptos. Q4 has been bullish for the markets in general but the Q4 of 2022 is much different than previous years.
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What to Expect from the Crypto Markets in Q4 of 2022?
The crypto markets never faced an economic recession after Bitcoin was launched in 2009 post the wave of an economic crash in 2008. For more than a decade, the crypto markets were mostly smooth sailing with dramatic crashes that had nothing to do with recession and inflation.
However, investors might say goodbye to the good old ‘Uptober’ and ‘Moonvember’ as a rally is nowhere on the horizon. The markets have dipped during the last three quarters of 2022 and the same trend might continue in Q4.
Analysts predict that the crypto markets have more chances of heading south in Q4 of 2022 than shooting up. The economic developments that are stunting the growth of cryptos are:
- Uncontrolled inflation
- Negative investor sentiments
- Fear of a looming recession
- Hawkish Feds
- Russia-Ukraine war
Inflation has singlehandedly dampened the markets’ prospects and made cryptos trade backward than allowing it to forward in price. This led to investor fatigue as the crypto markets are down for 10 consecutive months with no signs of recovery.
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To add fuel to fire, the U.S ended up with negative GDP for three quarters in 2022. The development suggested that the U.S is in a technical recession and the markets could plummet in the coming months. The Feds are raising interest rates regularly to tame inflation that’s causing turbulence in the markets.
The Russia-Ukraine war is ongoing and the negative financial effects have already hit Europe hard. All these developments suggest that Q4 of 2022 will not be the same as the previous Q4s of other years.