Bitcoin Eyes $45,000 Amid Anticipation Of FOMC Decision
29 Januar 2024 - 10:20AM
NEWSBTC
After a challenging two weeks resulting in a 21% drop, the Bitcoin
(BTC) price rebounded emphatically, closing last week on a strong
note. The premier cryptocurrency witnessed a surge that saw it end
with a Doji Hammer candle on its weekly chart, signaling a
potential bullish reversal. Notably, this uptick has propelled
Bitcoin’s value back into its previous range of $41,300 to $45,000.
Keith Alan, the co-founder of Material Indicators, highlighted the
significance of this pattern, stating, “Looks like we have a Doji
Hammer candle forming on the BTC Weekly chart. That typically
indicates a bullish reversal is coming. […] If we do indeed print a
Hammer, Bitcoin bulls will need to overcome resistance at the
bottom range of the Golden Pocket to have a chance at a meaningful
move to retest the $44k – $45k range.” Bitcoin has also reclaimed
its position above the 20- and 50-day Exponential Moving Averages
(EMAs), hinting at the potential for further gains. However, the
anticipation surrounding the first Federal Open Market Committee
(FOMC) meeting of 2024 adds a layer of complexity to Bitcoin’s
trajectory. FOMC Preview The upcoming Federal Open Market Committee
(FOMC) meeting, is anticipated to be a major determinant in the
short-term movement of Bitcoin’s price, as it could signal
significant shifts in the United States Federal Reserve’s monetary
policy approach. Macro analyst @tedtalksmacro provided an in-depth
perspective: “This week’s FOMC meeting is pivotal.” Currently, the
market is expecting the Fed to maintain the status quo, with a 97%
probability against any policy change. Related Reading: Bitcoin
Whales Increase Their Holdings By $3 Billion – Is A Price Surge
Imminent? “However, there’s a 46% chance of a rate cut by the March
meeting. Investors should closely monitor for signs of the Fed
moving towards a data-dependent approach, any recognition of
inflation nearing their 2% target, and potential adjustments to
Quantitative Tightening (QT) policies,” Ted remarked. After this
week, the Committee will meet again on March 19-20. Thus, this
week’s FOMC meeting could lay the foundation for the critical
decisions in March, which could have immediate and pronounced
effects on market dynamics. The Federal Reserve has forecasted that
it will reduce interest rates three times this year. The market
anticipates a possibility of five or more cuts. There is a general
agreement that the initial reduction in rates might occur in the
second quarter, though there is substantial support for the
possibility of it happening at the March meeting. Goldman Sachs has
been consistently predicting a rate cut by the Fed in March. Their
analysis is grounded in the significant progress observed in
inflation control. Related Reading: Analyst Predicts Bitcoin
Consolidation, Eyes Long-Term Price Target Of $500,000 The
post-FOMC meeting press conference will be a focal point, as
investors seek clarity on the collective view of the FOMC members,
including the newly rotated regional Fed bank presidents. These
officials, known for their cautious approach towards rate cuts,
will play a significant role in shaping the committee’s
decision-making process. December’s inflation report indicated a
3.4% year-on-year increase, with core prices rising more rapidly
than many economists had projected. However, the Department of
Commerce’s personal consumption expenditures (PCE) index, the Fed’s
preferred inflation measure, showed more promising signs of
inflation cooling down to 2.9%, aligning closer to the Fed’s
target. Implications For The Bitcoin Price Renowned crypto analyst
@ColdBloodShill drew attention to the historical inverse
correlation between the DXY (Dollar Index) and Bitcoin. He shared
the following chart and stated: “Heard you needed some hopium. The
last two FOMC events have marked the pico top of the DXY. Next one
on Wednesday.” A potential drop in the DXY following the FOMC
meeting could act as a catalyst for Bitcoin to rise towards the
$45,000 mark. In addition, there are possible changes in QT policy
that could indicate an increase in the supply of money. Such
developments could serve as a major catalyst for the Bitcoin price
as the hardest asset of the world. Featured image created with
DALL·E, chart from TradingView.com
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