Bitcoin sees worst monthly close in two years as traders watch $16.7K

Bitcoin (BTC $17,087) attempted to flip $17,000 to support on Dec. 1 after sealing its lowest monthly close in two years.

BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView

Bitcoin gains inch up as November end

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD circling $17,100 in a second intraday charge at higher levels.

The pair managed to avoid losses as the monthly candle closed, instead seeing solid daily gains of around 4.5% for Nov. 30.

Nonetheless, Bitcoin shed 16.2% for the month, making November 2022 its worst since 2019.

BTC/USD monthly returns chart (screenshot). Source: Coinglass

The more buoyant mood coincided with comments from the United States Federal Reserve. In a speech on inflation and the labor market, Chair Jerome Powell openly stated that smaller interest rate hikes could begin as soon as December.

“Monetary policy affects the economy and inflation with uncertain lags, and the full effects of our rapid tightening so far are yet to be felt,” he said.

Thus, it makes sense to moderate the pace of our rate increases as we approach the level of restraint that will be sufficient to bring inflation down. The time for moderating the pace of rate increases may come as soon as the December meeting.

Powell characteristically cautioned on heralding a full turning point in policy, something markets had been keenly awaiting throughout the year.

“Given our progress in tightening policy, the timing of that moderation is far less significant than the questions of how much further we will need to raise rates to control inflation, and the length of time it will be necessary to hold policy at a restrictive level,” he added.

Nonetheless, stocks reacted positively, the S&P 500 and Nasdaq Composite Index ending the day up 3.1% and 4.4%, respectively, in line with Bitcoin.

No euphoria among traders

In responses of their own, meanwhile, crypto market commentators were equally cool on the immediate prospects despite the moderate month-end gains.

Crypto Tony warned that bulls were “getting cocky” into December, and that now was not a suitable blind entry point.

“Now is not the time to go all in, thinking this is the bottom on Crypto,” he told Twitter followers.

We have yet to see : - A macro higher high and higher low (Market structure trend change) - Bull volume coming in - Spot buys on the increase - Completed corrective structure.

BTC/USD annotated chart. Source: Crypto Tony/ Twitter

A key level to hold for continuation of the “bullish market structure,” he added, was $16,700.

Michaël van de Poppe, founder and CEO of trading firm Eight, agreed on the importance of an area focused on $16,700 for his own strategy.

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