• Analyst breaks down market misinformation. 
• This includes a full explanation of the QT vs QE matter.
• The analyst remains bearish for the short and mid terms.

Doctor Profit, the reputed silver-tongued analyst, known for his many accurate predictions since before the start of this cycle, goes on to share a detailed report about what to expect next as crypto and stock enthusiasts. In detail, the analyst breaks down market misinformation and explains the discussion about the QT vs QE matter. What does this mean for the crypto market?

Analyst Breaks Down Market Misinformation 

The reputed and popular analyst, Doctor Profit, goes on to share his weekly technical analysis and psychological breakdown. He says that presently, there is a lot of misinformation and confusion circulating about the current macro environment, the Federal Reserve’s actions, and how they affect both the stock and crypto markets. He then begins to clear up these misunderstandings in three parts.

As we can see from the post above, the analyst goes on to state that there are three crucial parts to discuss. Firstly, the matter of QT vs QE, then the rumor of the Fed having printed $50 billion, and finally, the fact that many are calling for QE to start in 6 months. About the first matter, he says that these are two completely different stages in the monetary cycle.

QT vs QE, What Should Crypto Traders Watch For? 

In detail, QT means the Federal Reserve is reducing liquidity by letting bonds mature without reinvesting and QE means the Fed is expanding its balance sheet and injecting new liquidity through asset purchases. In other words, it means the FED collects back its dollars to pressure down inflation or simply print money. As of now, Jerome Powell has not announced QE and only stated that QT will officially end on December 1, 2025. 

Historically, the Fed only begins QE after a liquidity crisis develops, such as in 2008, the 2019 repo crisis, or the 2020 Covid crash. That pattern has never changed, and there is no evidence that it will be different this time. The second is the idea that the Fed ‘printed’ 50 billion dollars last Friday, which is incorrect. Now, markets are entering the late phase of QT, where cracks begin to show, and historically, this stage always precedes the next policy shift, usually the start of a new QE cycle.

Finally, he talks about the last factor, which is the call for QE to begin in 6 months. On this, the analyst says that a similar set-up to part patterns is currently playing out. Last time, QT ran from October 2017 to September 2019, and just six months later, in March 2020, the Fed was forced to launch a massive QE program after the markets collapsed during COVID. That six-month gap happened only once in history. Thus, the analyst remains bearish.

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