Bitcoin Price Stable Ahead of FOMC Meeting
Bitcoin (BTC) is showing no signs yet of any kind of volatility ahead of Wednesday’s Federal Reserve FOMC meeting. With no rate cut expected, the Bitcoin price may continue its current sideways trajectory. That said, is there a major rally on the horizon?
Rates to stay as they are
If the U.S. stock market is any kind of guide to what might come out of Wednesday’s FOMC meeting, it could be that nothing much out of the ordinary could be what is generally expected, barring Fed Chairman Powell talking the market up or down in his speech after the meeting.
According to the CME Fedwatch Tool, the market is 99% certain that no rate cuts will be forthcoming. This may disappoint the Trump administration, given that the President has made it clear that he wants a weaker dollar. That said, it seems that Powell still calls the shots, and until we see a weaker economy, it appears that rates stay as they are.
S&P 500 continued rally or rejection?
Source: TradingView
The S&P 500 continued its bounce on Monday, and closed in the green. However, the $5,670 level is proving to be strong resistance, and the price wicked through this level before coming back to settle below at the end of the day.
Breaking back above this level and turning it back into support will be vital for a continuation of the upward trend. This week’s price action, especially following the FOMC meeting on Wednesday, will be key to whether the stock market regains momentum, or whether the S&P 500 might fall to the next major support level at $5,400.
Bitcoin inverse head and shoulders confirmation?
Source: TradingView
So where does this leave Bitcoin? As it stands, the price has remained relatively stable over the weekend and into the beginning of this week. An inverse head and shoulders pattern is still in play, and the price broke beyond the neckline and has retested. If this pattern does come to fruition, the measured move would take the price out of the descending wedge to around $94,600. Just above $95,000 is the top of the last swing high and also where major resistance can be found.
Weekly time frame turns bullish for $BTC
Source: TradingView
On the much higher time frame of the weekly, a beginning of the next potential major rally is now certainly in evidence. A new support level looks to have been found at $80,000, and the price may have found a bottom here.
The first indicator below the main chart is the Stochastic RSI. It can be seen that the indicator lines have crossed, and that the blue line is above the orange. If these lines can continue to rise, and get above the 20.00 level, this will signal big upside price momentum.
Below this is the Relative Strength Index. Here it can be noted that the indicator line is bouncing from the very strong 44.00 level, which has acted as firm support and resistance throughout Bitcoin’s history.
The indicators are starting to look positive, and price is potentially also just beginning to react. A strong rally may not be far away. That said, Bitcoin needs the stock market. The S&P 500 must be watched closely.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
